1
00:00:00,080 --> 00:00:03,360
Speaker 1: Welcome to How to Money. I'm Joel and I am Matt,

2
00:00:03,400 --> 00:00:06,480
Speaker 1: and today we're talking traversing a broken housing market with

3
00:00:06,600 --> 00:00:07,360
Speaker 1: Lance Lambert.

4
00:00:26,640 --> 00:00:28,960
Speaker 2: Yeah. So, anyone who has spent any time in their

5
00:00:29,200 --> 00:00:31,880
Speaker 2: Zillow and their Redfinn apps over the past few years

6
00:00:32,320 --> 00:00:36,040
Speaker 2: knows that something is broken when it comes to home affordability.

7
00:00:36,400 --> 00:00:38,040
Speaker 2: Or maybe they don't know it, maybe they don't have

8
00:00:38,159 --> 00:00:40,200
Speaker 2: the data or the facts, but they feel it right

9
00:00:40,240 --> 00:00:42,720
Speaker 2: as they're looking at homes. They might be overwhelmed to

10
00:00:42,720 --> 00:00:45,360
Speaker 2: given the current state of the housing market. They might

11
00:00:45,400 --> 00:00:48,159
Speaker 2: be saying, how can home prices continue to skyrocket like

12
00:00:48,240 --> 00:00:50,120
Speaker 2: they have? And even if prices taper off some how

13
00:00:50,120 --> 00:00:51,760
Speaker 2: am I supposed to save up a down payment in

14
00:00:51,840 --> 00:00:55,000
Speaker 2: order to actually make a competitive offer. There are a

15
00:00:55,080 --> 00:00:57,480
Speaker 2: lot of just big unknowns when it comes to the

16
00:00:57,520 --> 00:01:00,600
Speaker 2: largest financial decision that many of us will make. But

17
00:01:00,720 --> 00:01:04,600
Speaker 2: luckily we're joined by Lance Lambert. Lance is the nation's

18
00:01:04,640 --> 00:01:08,360
Speaker 2: foremost data journalist and beat reporter in the residential real

19
00:01:08,440 --> 00:01:11,160
Speaker 2: estate space. He's been the real estate editor over at

20
00:01:11,160 --> 00:01:14,880
Speaker 2: Fortune Magazine, and he's recently launched Rezi Club to help

21
00:01:14,880 --> 00:01:18,400
Speaker 2: folks to stay informed on the US housing market. Lance,

22
00:01:18,480 --> 00:01:20,520
Speaker 2: thank you so much. For joining us today on the podcast.

23
00:01:20,880 --> 00:01:23,200
Speaker 3: Yeah, thank you so much for having me on. And

24
00:01:23,760 --> 00:01:25,479
Speaker 3: you hit the nail on the head right there, which

25
00:01:25,560 --> 00:01:30,680
Speaker 3: is that housing affordability has deteriorated at the fastest pace

26
00:01:30,920 --> 00:01:34,480
Speaker 3: ever over the past two years, only three years. And

27
00:01:34,520 --> 00:01:38,680
Speaker 3: so what happened there is we had an overheating on

28
00:01:38,800 --> 00:01:44,120
Speaker 3: prices during the pandemic. And what was going on is

29
00:01:44,160 --> 00:01:48,280
Speaker 3: that there was an elevation in the demand for housing space,

30
00:01:49,040 --> 00:01:53,360
Speaker 3: and so people, because they were working from home, could

31
00:01:53,400 --> 00:01:56,200
Speaker 3: work in other you know, go live in other markets,

32
00:01:56,200 --> 00:01:59,800
Speaker 3: go buy a home in let's say, you know, Lexington,

33
00:01:59,800 --> 00:02:02,600
Speaker 3: can if they were working in New York City, and

34
00:02:02,680 --> 00:02:05,800
Speaker 3: so they were able to depart their job market for

35
00:02:05,840 --> 00:02:09,160
Speaker 3: a more affordable place. So that's work from home arbitrage.

36
00:02:09,600 --> 00:02:12,000
Speaker 3: And then the second part is the people who stayed

37
00:02:12,000 --> 00:02:15,720
Speaker 3: in those markets, even the places that had net out migration,

38
00:02:16,160 --> 00:02:20,160
Speaker 3: think San Francisco, Los Angeles, New York City. The people

39
00:02:20,160 --> 00:02:23,240
Speaker 3: who remained wanted more space because they wanted to work,

40
00:02:23,320 --> 00:02:25,960
Speaker 3: they were working from home, they needed more room in

41
00:02:26,000 --> 00:02:29,720
Speaker 3: their apartments. And so there was this elevation in demand

42
00:02:29,840 --> 00:02:34,200
Speaker 3: for housing space and the work from home arbitrage that occurred.

43
00:02:34,639 --> 00:02:36,720
Speaker 3: And at the same time, you had rates go to

44
00:02:36,760 --> 00:02:40,240
Speaker 3: the lowest ever this century, really over the past one

45
00:02:40,320 --> 00:02:43,600
Speaker 3: hundred plus years, and you had a lot of easy

46
00:02:43,639 --> 00:02:45,959
Speaker 3: money rolling through the economy.

47
00:02:45,639 --> 00:02:47,839
Speaker 2: And so appreciates any money.

48
00:02:47,639 --> 00:02:51,520
Speaker 3: Yes, appreciation for housing. For home prices on a national

49
00:02:51,560 --> 00:02:56,560
Speaker 3: basis went up about forty five percent from March twenty

50
00:02:56,760 --> 00:03:01,840
Speaker 3: twenty to June twenty twenty twowenty twenty one alone, we

51
00:03:01,840 --> 00:03:04,639
Speaker 3: were up like twenty one percent, which is the biggest

52
00:03:05,440 --> 00:03:08,520
Speaker 3: year ever, one year jump ever in home prices.

53
00:03:08,639 --> 00:03:11,880
Speaker 1: Yeah, Studio apartments basically became persona non grata who wants

54
00:03:11,919 --> 00:03:13,799
Speaker 1: them because you need a space of orger Like I

55
00:03:13,840 --> 00:03:16,000
Speaker 1: distinctly remember the beginning of the pandemic, my little sister

56
00:03:16,440 --> 00:03:19,040
Speaker 1: and her husband working out, both of them trying to

57
00:03:19,080 --> 00:03:21,080
Speaker 1: work from home in a studio apartment and it was

58
00:03:21,120 --> 00:03:23,960
Speaker 1: not working very well. But listen, sorry, we have to

59
00:03:24,200 --> 00:03:26,080
Speaker 1: ask you. One of the first questions we ask anybody

60
00:03:26,080 --> 00:03:27,840
Speaker 1: who comes on the show is what's your craft beer equivalent?

61
00:03:27,919 --> 00:03:29,959
Speaker 1: Because like, we want to get into all this housing data.

62
00:03:30,000 --> 00:03:31,680
Speaker 1: And I love that you're like chopping at the bit

63
00:03:31,720 --> 00:03:32,280
Speaker 1: to get started.

64
00:03:32,360 --> 00:03:34,840
Speaker 3: Yeah, but you know, I'm always ready to just like

65
00:03:34,920 --> 00:03:38,360
Speaker 3: take off the place. And so you want to know

66
00:03:38,600 --> 00:03:40,920
Speaker 3: where I splurge on money, right exactly?

67
00:03:40,960 --> 00:03:41,240
Speaker 2: Sure.

68
00:03:41,360 --> 00:03:44,440
Speaker 3: Yeah, So I am a long I grew up in

69
00:03:44,520 --> 00:03:47,440
Speaker 3: the Cincinnati area. I lived in New York before the

70
00:03:47,480 --> 00:03:51,200
Speaker 3: pandemic hit. But when the pandemic hit, we had this

71
00:03:51,280 --> 00:03:54,960
Speaker 3: guy named Joe Burrow that the Cincinnati Bengals drafted. Oh yeah,

72
00:03:55,000 --> 00:03:56,920
Speaker 3: and I was already ready to move home, but that

73
00:03:57,040 --> 00:03:59,320
Speaker 3: even made me wanted to get home more. And I

74
00:03:59,440 --> 00:04:01,360
Speaker 3: kind of just had a feeling because I also watched

75
00:04:01,360 --> 00:04:03,880
Speaker 3: college football that we were going to turn it around

76
00:04:03,920 --> 00:04:05,720
Speaker 3: with Joe Burrow. It just kind of felt like it.

77
00:04:05,760 --> 00:04:08,960
Speaker 3: And so my area that I splurge on is anything Bengals.

78
00:04:09,000 --> 00:04:11,640
Speaker 3: I like to go to some road games, you know,

79
00:04:11,720 --> 00:04:13,920
Speaker 3: I like to go to the home games. You know,

80
00:04:13,960 --> 00:04:17,160
Speaker 3: I probably have bought like six or seven jerseys over

81
00:04:17,160 --> 00:04:21,159
Speaker 3: the past, and I'm not you know, I'm a tightwad,

82
00:04:21,360 --> 00:04:25,080
Speaker 3: so you know, and you know, like somebody have a

83
00:04:25,080 --> 00:04:27,760
Speaker 3: big interception, I'll just go by their jersey. So I'm

84
00:04:27,800 --> 00:04:33,520
Speaker 3: feeling splurging more on Cincinnati Bengals just because it feels

85
00:04:33,520 --> 00:04:35,720
Speaker 3: like this is, you know, a rare moment for us

86
00:04:35,760 --> 00:04:39,240
Speaker 3: where we might be all right. Although you know, by

87
00:04:39,279 --> 00:04:41,799
Speaker 3: the time this publishes, we could have lost several games

88
00:04:41,800 --> 00:04:45,240
Speaker 3: and lost. You know it hasn't been off to the

89
00:04:45,240 --> 00:04:45,800
Speaker 3: best start.

90
00:04:46,080 --> 00:04:49,600
Speaker 2: No, that is perfect. I love in particular your tight wad,

91
00:04:49,600 --> 00:04:51,279
Speaker 2: but you are willing to splurge in this way. And

92
00:04:51,320 --> 00:04:53,480
Speaker 2: by the way you said like six or seven jerseys.

93
00:04:53,480 --> 00:04:57,360
Speaker 2: Those jerseys are not like that alone could have been

94
00:04:58,000 --> 00:04:59,760
Speaker 2: on top of it. You at the away games.

95
00:05:00,160 --> 00:05:02,200
Speaker 3: A few of them are official, and then a few

96
00:05:02,200 --> 00:05:04,000
Speaker 3: were like the fifteen dollars from China.

97
00:05:04,200 --> 00:05:06,080
Speaker 2: Nice. So you got to get you get the knockoffs

98
00:05:06,080 --> 00:05:08,520
Speaker 2: where the color is not quite right. It's a I've

99
00:05:08,520 --> 00:05:10,840
Speaker 2: done that before. Matt might have made fun of me.

100
00:05:10,880 --> 00:05:13,120
Speaker 2: I got one from our local soccer team in Atlanta,

101
00:05:13,200 --> 00:05:16,080
Speaker 2: and like the red was definitely a lot more abrasive.

102
00:05:16,160 --> 00:05:18,040
Speaker 2: It was a little pink had a pick here than

103
00:05:18,120 --> 00:05:22,320
Speaker 2: the red. Atlanta United was rocking. But Lance, I feel

104
00:05:22,320 --> 00:05:24,080
Speaker 2: like you caught us up to speed when it came

105
00:05:24,240 --> 00:05:26,799
Speaker 2: to the reaction of housing prices.

106
00:05:27,000 --> 00:05:30,920
Speaker 3: Like I got to the first half, which is house prices. Sure, yeah, Really,

107
00:05:30,960 --> 00:05:35,320
Speaker 3: the thing that a deteriorated affordability wasn't just the house

108
00:05:35,360 --> 00:05:38,400
Speaker 3: price jump. Really, if you break down the math, the

109
00:05:38,440 --> 00:05:42,120
Speaker 3: biggest part is just the historic move up in interest

110
00:05:42,200 --> 00:05:46,000
Speaker 3: rates right, going from two three percent mortgage rates to

111
00:05:46,160 --> 00:05:50,080
Speaker 3: four to five to six percent to seven percent, and

112
00:05:50,120 --> 00:05:53,080
Speaker 3: then you know, this fall to hit that eight handle.

113
00:05:53,600 --> 00:05:56,159
Speaker 3: And when you do the math with the house price

114
00:05:56,279 --> 00:05:58,919
Speaker 3: move and then also the move up in rates and

115
00:05:58,960 --> 00:06:01,880
Speaker 3: the fact that income, the third variable, just hasn't kept

116
00:06:01,960 --> 00:06:04,800
Speaker 3: up over the past three years, what you'll see is

117
00:06:04,800 --> 00:06:09,080
Speaker 3: that we were in the fastest deterioration ever for housing affordability.

118
00:06:09,440 --> 00:06:11,600
Speaker 3: This is the fastest move up in a three year

119
00:06:11,720 --> 00:06:16,960
Speaker 3: period ever. And we also have reached the most expensive

120
00:06:18,240 --> 00:06:21,839
Speaker 3: period for housing this century since two thousand. But really,

121
00:06:21,920 --> 00:06:25,679
Speaker 3: if you go back, this is the most expensive housing

122
00:06:25,760 --> 00:06:29,080
Speaker 3: has been for new home buyers since nineteen eighty four

123
00:06:29,240 --> 00:06:33,480
Speaker 3: and really only beat by eighty one eighty two, when

124
00:06:33,520 --> 00:06:36,960
Speaker 3: mortgage rates were kind of pushing sixteen seventeen eighteen percent

125
00:06:37,600 --> 00:06:39,920
Speaker 3: at the you know, at the peak of Paul Volker's

126
00:06:40,720 --> 00:06:45,839
Speaker 3: interest rate hikes. And so the affordability has really deteriorated quickly,

127
00:06:46,279 --> 00:06:49,520
Speaker 3: not just for housing, but also autos, which saw the

128
00:06:49,560 --> 00:06:53,400
Speaker 3: same overheating for prices and the same rate shock as

129
00:06:53,440 --> 00:06:58,840
Speaker 3: housing did. And the results there are interesting. You know,

130
00:06:59,160 --> 00:07:02,560
Speaker 3: it's not just one you know, it's not all that

131
00:07:02,680 --> 00:07:04,800
Speaker 3: you know, housing is in a bad spot, or housing

132
00:07:04,839 --> 00:07:07,159
Speaker 3: it's in a good spot when you kind of break

133
00:07:07,400 --> 00:07:10,760
Speaker 3: it down. There's a lot going on based on this

134
00:07:10,840 --> 00:07:16,800
Speaker 3: deterioration and affordability for starters. The existing home sales now

135
00:07:16,960 --> 00:07:19,520
Speaker 3: are lower than they were at the bottom of the

136
00:07:19,760 --> 00:07:25,560
Speaker 3: eight ten, nine, ten, twenty eleven crash. And what's happened

137
00:07:25,720 --> 00:07:29,720
Speaker 3: is that affordability has deteriorated so quickly that people with

138
00:07:29,840 --> 00:07:34,480
Speaker 3: two three four percent mortgage rates and their lower monthly

139
00:07:34,520 --> 00:07:37,520
Speaker 3: payments are like, well, why would I sell my home

140
00:07:37,600 --> 00:07:38,880
Speaker 3: and go buy something new?

141
00:07:39,360 --> 00:07:41,640
Speaker 1: Even if you had triplets, You're staying in the two

142
00:07:41,720 --> 00:07:43,680
Speaker 1: two because you don't want to give up the three

143
00:07:43,720 --> 00:07:44,200
Speaker 1: percent rate.

144
00:07:44,920 --> 00:07:48,040
Speaker 3: Yeah, yeah, And so you know, my my wife's pregnant.

145
00:07:48,040 --> 00:07:50,000
Speaker 3: You know, not all our family knows, but hopefully by

146
00:07:50,040 --> 00:07:54,520
Speaker 3: the time publishes we will have told everybody. But we

147
00:07:54,640 --> 00:07:56,600
Speaker 3: have a three bedroom house and this would be our

148
00:07:56,600 --> 00:07:59,280
Speaker 3: third kid, and it just doesn't make sense for us

149
00:07:59,320 --> 00:08:01,520
Speaker 3: to go buy some they knew right now, we'd rather

150
00:08:01,600 --> 00:08:04,720
Speaker 3: just bunk at it because the math doesn't make sense.

151
00:08:04,840 --> 00:08:07,920
Speaker 3: And so you've taken out what I call churn in

152
00:08:07,960 --> 00:08:11,080
Speaker 3: the market, somebody selling to go buy something new, And

153
00:08:11,120 --> 00:08:16,160
Speaker 3: so the existing resale market is just very constrained right

154
00:08:16,200 --> 00:08:20,160
Speaker 3: now because there's not much coming up for sale. So

155
00:08:20,240 --> 00:08:23,040
Speaker 3: that's the first part. The second part is if you

156
00:08:23,240 --> 00:08:27,680
Speaker 3: look at the home construction side, the new side of

157
00:08:27,720 --> 00:08:30,160
Speaker 3: the market, not the existing the new side where the

158
00:08:30,160 --> 00:08:34,240
Speaker 3: home builders play, what they have done is unlike the

159
00:08:34,280 --> 00:08:37,000
Speaker 3: existing side of the market, which has been very sticky

160
00:08:37,040 --> 00:08:42,119
Speaker 3: on prices, the homebuilders have given up some on prices,

161
00:08:42,480 --> 00:08:45,720
Speaker 3: and in particular on a net effective basis for mortgage

162
00:08:45,800 --> 00:08:48,640
Speaker 3: rate buydowns, in particular in markets where there's a lot

163
00:08:48,720 --> 00:08:53,360
Speaker 3: of new construction. Think Austin, Think Boise, think Phoenix, think

164
00:08:53,400 --> 00:08:55,400
Speaker 3: a lot of these places in the South that build

165
00:08:55,440 --> 00:08:58,200
Speaker 3: a lot of homes, and including Dallas. The builders have

166
00:08:58,280 --> 00:09:00,880
Speaker 3: given up some on prices, but they've also done these

167
00:09:00,920 --> 00:09:04,360
Speaker 3: mortgage rate buydowns, and they'll buy people down into the

168
00:09:04,400 --> 00:09:07,520
Speaker 3: five handle and sometimes even into the four handle high

169
00:09:07,600 --> 00:09:12,240
Speaker 3: fours to get people interested or getting them to pull

170
00:09:12,280 --> 00:09:14,400
Speaker 3: the trigger. And so a lot of the people who

171
00:09:14,440 --> 00:09:17,839
Speaker 3: would have normally looked at the existing resale market are

172
00:09:17,880 --> 00:09:22,160
Speaker 3: now looking at the builders and looking there because affordability

173
00:09:22,240 --> 00:09:25,360
Speaker 3: is so deteriorated, and they're the one player in town

174
00:09:25,960 --> 00:09:31,040
Speaker 3: that has made some affordability adjustments, and so new home

175
00:09:31,160 --> 00:09:35,880
Speaker 3: sales have actually rebounded after last year's big or in

176
00:09:35,920 --> 00:09:38,880
Speaker 3: twenty twenty two is big cratering. There was a big

177
00:09:38,920 --> 00:09:43,280
Speaker 3: plummet down in new home sales and a huge spike

178
00:09:43,320 --> 00:09:47,559
Speaker 3: in cancelation rates among builders. But by early twenty twenty three,

179
00:09:48,080 --> 00:09:50,400
Speaker 3: the builders had kind of figured out the right mix

180
00:09:50,440 --> 00:09:54,200
Speaker 3: of incentives, buydowns, and price cuts to bring the buyers

181
00:09:54,240 --> 00:09:57,840
Speaker 3: into the existing market. So new home construction on the

182
00:09:57,880 --> 00:10:01,600
Speaker 3: single family side has been fairly resiling, and we haven't

183
00:10:01,640 --> 00:10:07,760
Speaker 3: seen many layoffs in new and residential construction employment. One

184
00:10:07,840 --> 00:10:11,720
Speaker 3: reason being that, you know, single family sales have rebounded

185
00:10:11,720 --> 00:10:14,640
Speaker 3: in new construction. And then also the fact that there

186
00:10:14,679 --> 00:10:18,880
Speaker 3: is this huge pipeline a multifamily still under construction and

187
00:10:18,960 --> 00:10:23,520
Speaker 3: it was kind of planned back when rates were lower,

188
00:10:23,640 --> 00:10:26,720
Speaker 3: so that's still in the pipeline. And why that matters

189
00:10:26,840 --> 00:10:31,000
Speaker 3: is from an economic perspective, housing is one of the

190
00:10:31,040 --> 00:10:36,880
Speaker 3: areas where the fed's rate policy has normally transmitted into

191
00:10:36,920 --> 00:10:40,079
Speaker 3: the rest of the economy. And so how it's normally

192
00:10:40,160 --> 00:10:46,800
Speaker 3: worked is the FED jack's up rates, affordability deteriorates, new

193
00:10:46,840 --> 00:10:51,280
Speaker 3: home sales fall way down, builders pull back on construction.

194
00:10:52,760 --> 00:10:54,959
Speaker 3: You know, there's some there's a lot of layoffs and

195
00:10:55,080 --> 00:10:58,920
Speaker 3: residential construction employment. Those people spend less than the rest

196
00:10:58,960 --> 00:11:01,720
Speaker 3: of the economy, and that kind of trickles through. We're

197
00:11:01,720 --> 00:11:05,679
Speaker 3: not seeing that right now. We've seen the deterioration and affordability,

198
00:11:06,000 --> 00:11:10,800
Speaker 3: but builders have made the cycle rolled over on affordability

199
00:11:10,840 --> 00:11:13,480
Speaker 3: because they made some affordability adjustments and they were able

200
00:11:13,520 --> 00:11:18,000
Speaker 3: to keep volume transactions and employment moving.

201
00:11:18,120 --> 00:11:20,200
Speaker 2: So that's okay, So quick question, then I think I

202
00:11:20,240 --> 00:11:23,240
Speaker 2: saw so according to data from the Census Bureau, like

203
00:11:23,360 --> 00:11:26,040
Speaker 2: recent permits and starts, they seemed to be down from

204
00:11:26,080 --> 00:11:27,920
Speaker 2: a couple years ago. So it does seem like construction

205
00:11:28,040 --> 00:11:31,000
Speaker 2: has maintained, but as far as new construction, as far

206
00:11:31,040 --> 00:11:34,000
Speaker 2: as new permits, those seemed to be declining compared to

207
00:11:34,200 --> 00:11:35,560
Speaker 2: what we saw a couple of years ago.

208
00:11:35,960 --> 00:11:39,720
Speaker 3: Yeah, there's been some there, but on the single family side,

209
00:11:40,480 --> 00:11:44,120
Speaker 3: the completions have held steady. One of the things that

210
00:11:44,240 --> 00:11:48,960
Speaker 3: was happening during the pandemic is that starts and also

211
00:11:49,240 --> 00:11:54,959
Speaker 3: sales were outstripping the capacity to build, and the time

212
00:11:55,000 --> 00:11:58,560
Speaker 3: to completion for these new homes got really high. And

213
00:11:58,640 --> 00:12:01,680
Speaker 3: so what you've seen is you've seen the sales come

214
00:12:01,720 --> 00:12:05,199
Speaker 3: down from the frothy pandemic tops and the permits come

215
00:12:05,240 --> 00:12:08,200
Speaker 3: down from the frothy pandemic tops. But you have seen

216
00:12:08,280 --> 00:12:13,560
Speaker 3: completions hold steady. And what had to happen there is

217
00:12:13,600 --> 00:12:17,679
Speaker 3: that the time to completion is starting to normalize. Builders

218
00:12:17,679 --> 00:12:21,080
Speaker 3: who are able to build the homes faster, And so

219
00:12:21,960 --> 00:12:26,400
Speaker 3: you know, the hit there hasn't been that big when

220
00:12:26,480 --> 00:12:29,480
Speaker 3: adjusting for how high it got during the pandemic. If

221
00:12:29,520 --> 00:12:33,200
Speaker 3: you compare it to twenty nineteen levels on the starts

222
00:12:33,200 --> 00:12:35,480
Speaker 3: and the permits, you start to get a bit of

223
00:12:35,480 --> 00:12:36,520
Speaker 3: a different story.

224
00:12:36,640 --> 00:12:39,199
Speaker 1: Is part of that that they're building smaller houses? I've

225
00:12:39,240 --> 00:12:41,600
Speaker 1: read more about it seems like new home builds are

226
00:12:41,840 --> 00:12:43,280
Speaker 1: for the first time in a long time, for the

227
00:12:43,280 --> 00:12:47,000
Speaker 1: first time in like fifty sixty years, becoming like smaller

228
00:12:47,040 --> 00:12:49,800
Speaker 1: homes are being built. And that seems to be given

229
00:12:49,880 --> 00:12:51,959
Speaker 1: kind of how things have gotten locked up and affordability

230
00:12:51,960 --> 00:12:54,160
Speaker 1: has become a problem. Maybe that's at least one part

231
00:12:54,200 --> 00:12:54,760
Speaker 1: of a solution.

232
00:12:55,440 --> 00:12:58,720
Speaker 3: Yeah, So what we've seen since really about twenty eighteen

233
00:12:59,200 --> 00:13:03,280
Speaker 3: is that gradually builders have been building smaller homes. We've

234
00:13:03,360 --> 00:13:05,960
Speaker 3: kind of seen a rolling over on the square footage

235
00:13:06,240 --> 00:13:08,840
Speaker 3: for the average home and it's been moving down, not

236
00:13:09,120 --> 00:13:12,720
Speaker 3: just you know, on a national aggregate, but really almost

237
00:13:12,760 --> 00:13:17,679
Speaker 3: every market is getting smaller and that is probably going

238
00:13:17,760 --> 00:13:21,720
Speaker 3: to continue to accelerate now that affordability has just deteriorated

239
00:13:21,760 --> 00:13:25,120
Speaker 3: to the levels it has gotten to. But this has

240
00:13:25,160 --> 00:13:27,679
Speaker 3: been a steady move down, and we're not talking like

241
00:13:27,920 --> 00:13:32,640
Speaker 3: drastic moves. We're talking like two three percent contraction per

242
00:13:32,760 --> 00:13:35,319
Speaker 3: year in square footage. So it adds up, you know,

243
00:13:35,400 --> 00:13:37,760
Speaker 3: if you look at it from now versus twenty eighteen.

244
00:13:38,160 --> 00:13:40,960
Speaker 3: But it's a very gradual move down.

245
00:13:41,080 --> 00:13:42,920
Speaker 2: We're kind of talking about that. I guess overall the

246
00:13:42,960 --> 00:13:48,040
Speaker 2: supply of housing and how that's impacted housing affordability. How

247
00:13:48,080 --> 00:13:51,080
Speaker 2: have investors been impacting what's happening in the in the

248
00:13:51,120 --> 00:13:53,000
Speaker 2: housing market. Do you think the different Wall Street firms

249
00:13:53,040 --> 00:13:55,720
Speaker 2: out there investing in single family homes have they had

250
00:13:55,760 --> 00:13:58,520
Speaker 2: a big effect on the lack of inventory for uner occupants.

251
00:13:58,880 --> 00:14:03,920
Speaker 3: So on a national basis, institutional home buyers those with

252
00:14:04,160 --> 00:14:07,839
Speaker 3: you at least one thousand homes in their inventory. They

253
00:14:07,920 --> 00:14:11,840
Speaker 3: own about zero point seven three percent of the national

254
00:14:11,880 --> 00:14:15,560
Speaker 3: single family housing stock according to Parcel Labs data. So

255
00:14:15,600 --> 00:14:19,480
Speaker 3: they're not a huge amount of the total housing.

256
00:14:19,160 --> 00:14:21,200
Speaker 2: Stock except for where we live here in Atlanta.

257
00:14:21,280 --> 00:14:25,040
Speaker 3: Right, That's what I'm getting to is that in Atlanta

258
00:14:25,160 --> 00:14:27,800
Speaker 3: they own four point four percent of the single family

259
00:14:27,840 --> 00:14:31,760
Speaker 3: housing stock, and if you look at it based on

260
00:14:31,800 --> 00:14:35,960
Speaker 3: a zip code level, there are around eleven zip codes

261
00:14:36,160 --> 00:14:40,520
Speaker 3: in the Atlanta area where they own about half of

262
00:14:40,600 --> 00:14:45,440
Speaker 3: the single family rental stock. And so my view on

263
00:14:45,880 --> 00:14:50,280
Speaker 3: institutional home buyers is that I believe on a nationally

264
00:14:50,320 --> 00:14:55,320
Speaker 3: aggregated basis, they're probably not moving the needle a ton,

265
00:14:56,200 --> 00:15:00,000
Speaker 3: but on a regional basis in a certain specific pockets,

266
00:15:00,040 --> 00:15:04,280
Speaker 3: it's they are probably the marginal home buyer in some

267
00:15:04,360 --> 00:15:07,320
Speaker 3: of these areas where they've kind of all piled into

268
00:15:07,880 --> 00:15:11,840
Speaker 3: and I think with Alanta in particular, they're probably you know,

269
00:15:11,960 --> 00:15:15,760
Speaker 3: running their numbers and they're like, oh, Atlanta has good

270
00:15:15,840 --> 00:15:21,440
Speaker 3: population growth, Oh, Alana has good rental growth. Oh Alana

271
00:15:21,880 --> 00:15:23,840
Speaker 3: has good home appreciation growth.

272
00:15:24,240 --> 00:15:24,480
Speaker 2: Oh.

273
00:15:24,520 --> 00:15:28,600
Speaker 3: And by the way, affordability in Atlanta relative to where

274
00:15:28,640 --> 00:15:31,240
Speaker 3: some of these buyers are coming from is kind of

275
00:15:31,280 --> 00:15:34,400
Speaker 3: in a good spot, and the rent yields just work

276
00:15:34,440 --> 00:15:36,960
Speaker 3: out great. And so a lot of them have probably

277
00:15:37,080 --> 00:15:40,440
Speaker 3: just piled into the market because they're all seeing the

278
00:15:40,480 --> 00:15:44,320
Speaker 3: same aggregate data. That's the view of kind of parcel labs,

279
00:15:45,160 --> 00:15:47,560
Speaker 3: and I think they're probably right, and so I think

280
00:15:47,600 --> 00:15:52,160
Speaker 3: they have an outsized impact in some markets. And I

281
00:15:52,160 --> 00:15:57,720
Speaker 3: think those markets are probably Charlotte, Alana, Tampa, Dallas, Phoenix,

282
00:15:58,600 --> 00:16:01,080
Speaker 3: and I'm missing one more, might you like Houston, but

283
00:16:01,200 --> 00:16:04,120
Speaker 3: really you would probably think Raley and Jacksonville are right

284
00:16:04,120 --> 00:16:08,720
Speaker 3: there too. But those, you know, the states in you know,

285
00:16:08,800 --> 00:16:10,840
Speaker 3: the sun Belt that are kind of like high growth

286
00:16:10,920 --> 00:16:16,440
Speaker 3: states that have good long term outlooks and reasonable state

287
00:16:16,560 --> 00:16:21,680
Speaker 3: laws for you know, for landlords is probably you know

288
00:16:21,840 --> 00:16:23,640
Speaker 3: what they're after, and really at the end of the day,

289
00:16:23,680 --> 00:16:26,480
Speaker 3: it's about those yields. Can they get the returns on

290
00:16:26,520 --> 00:16:29,080
Speaker 3: the capitol they want? And those have been some of

291
00:16:29,120 --> 00:16:31,320
Speaker 3: the markets over the past several years that they've been

292
00:16:31,320 --> 00:16:34,600
Speaker 3: able to And if you zoom out, what occurred during

293
00:16:34,600 --> 00:16:38,320
Speaker 3: the pandemic is we saw a huge rush of investors

294
00:16:38,840 --> 00:16:41,800
Speaker 3: everybody from you know, the mom and pops, the people

295
00:16:41,840 --> 00:16:46,000
Speaker 3: who want to do you know, amateur airbnb folks. And

296
00:16:46,040 --> 00:16:48,760
Speaker 3: then you also saw it on the institutional side. And

297
00:16:48,840 --> 00:16:52,560
Speaker 3: what occurred is there was a very easy access to

298
00:16:52,640 --> 00:16:56,760
Speaker 3: capital during that you know, low rate, high stimulus period.

299
00:16:57,600 --> 00:17:02,520
Speaker 3: There was the low rates, soaring rents and high home appreciation,

300
00:17:03,120 --> 00:17:05,280
Speaker 3: and when you add all those factors in the yields

301
00:17:05,320 --> 00:17:08,000
Speaker 3: were just amazing. And so, you know, a lot of

302
00:17:08,040 --> 00:17:12,760
Speaker 3: the biggest buyers American homes for rent, invitation homes, Amherst Tricon,

303
00:17:13,040 --> 00:17:16,000
Speaker 3: you know, they were out there buying. And now what

304
00:17:16,040 --> 00:17:19,120
Speaker 3: we've seen is we've seen rates move very high, home

305
00:17:19,160 --> 00:17:23,600
Speaker 3: prices have stayed high. Rents relative to home prices are

306
00:17:23,920 --> 00:17:27,760
Speaker 3: very strained, and there's not a lot of inventory on

307
00:17:27,800 --> 00:17:30,280
Speaker 3: the market, and so there's not a lot out there

308
00:17:30,320 --> 00:17:32,560
Speaker 3: available for sale and not a lot of it that

309
00:17:32,720 --> 00:17:36,000
Speaker 3: is out there pencils. And remember these people often spend

310
00:17:36,040 --> 00:17:39,679
Speaker 3: a lot of money on renovations too, and realizations and

311
00:17:39,720 --> 00:17:43,919
Speaker 3: repairs are very expensive. Given the inflationary run and the

312
00:17:44,000 --> 00:17:48,080
Speaker 3: move up and capital cost on that side, we're seeing

313
00:17:48,160 --> 00:17:50,000
Speaker 3: less institutional home buying right now.

314
00:17:50,160 --> 00:17:53,040
Speaker 1: Yeah, you mentioned you mentioned rents, and that is something

315
00:17:53,119 --> 00:17:57,160
Speaker 1: that Yeah, during the really heart of the pandemic, rents

316
00:17:57,160 --> 00:17:59,800
Speaker 1: were skyrocketing, and we had certainly a lot of listeners

317
00:18:00,000 --> 00:18:01,840
Speaker 1: reaching out like what do I do? How do I

318
00:18:01,840 --> 00:18:05,120
Speaker 1: push back against these crazy rent increases? But now rents

319
00:18:05,200 --> 00:18:08,200
Speaker 1: are softening and in fact like falling year over year,

320
00:18:08,480 --> 00:18:11,760
Speaker 1: which is good for what we're talking about the affordability

321
00:18:12,160 --> 00:18:15,320
Speaker 1: for folks who are looking to rent, but that doesn't

322
00:18:15,359 --> 00:18:18,400
Speaker 1: necessarily help home buyers. But I'm curious like to hear

323
00:18:18,440 --> 00:18:22,119
Speaker 1: your thoughts on we have this massive spread now between

324
00:18:22,119 --> 00:18:24,920
Speaker 1: the average cost monthly cost of a mortgage versus the

325
00:18:24,920 --> 00:18:29,280
Speaker 1: monthly cost of rent, especially in places like California. So

326
00:18:29,920 --> 00:18:33,240
Speaker 1: is renting a superior option for so many people who

327
00:18:33,240 --> 00:18:35,879
Speaker 1: are like I want to own a home. Is patients

328
00:18:36,040 --> 00:18:39,359
Speaker 1: the best way to proceed given kind of how much

329
00:18:39,400 --> 00:18:41,360
Speaker 1: cheaper rents are relative to the home.

330
00:18:41,560 --> 00:18:43,479
Speaker 3: Yeah, So I want to be careful here. You know.

331
00:18:43,560 --> 00:18:44,920
Speaker 3: One of the things I try to do in the

332
00:18:44,960 --> 00:18:47,280
Speaker 3: space is be a little bit more of a journalist,

333
00:18:47,359 --> 00:18:50,000
Speaker 3: a little less of an analyst, and try to not

334
00:18:50,160 --> 00:18:53,040
Speaker 3: make too many big predictions. That way, I can, you know,

335
00:18:53,200 --> 00:18:56,600
Speaker 3: kind of spread other people's views and be a good

336
00:18:56,640 --> 00:18:59,040
Speaker 3: place for people to get exposed to a lot of

337
00:18:59,119 --> 00:19:02,800
Speaker 3: different viewpoints. But I will say, in terms of the data,

338
00:19:03,119 --> 00:19:06,320
Speaker 3: we have seen a softening of rents and rent growth.

339
00:19:06,320 --> 00:19:10,240
Speaker 3: That is true. We've seen some falling rents on the

340
00:19:10,359 --> 00:19:17,800
Speaker 3: multifamily side in very big boom towns think Austin, think Boise, Phoenix,

341
00:19:17,880 --> 00:19:20,760
Speaker 3: some of those places with a lot of multifamily inventory

342
00:19:20,800 --> 00:19:24,399
Speaker 3: coming into the market, but we have continued to see

343
00:19:25,520 --> 00:19:31,760
Speaker 3: rising prices for single family rents and you know, invitation

344
00:19:31,880 --> 00:19:35,280
Speaker 3: homes which they own almost ninety thousand single family rentals.

345
00:19:35,520 --> 00:19:38,440
Speaker 3: If you look at their earnings report year over year

346
00:19:38,520 --> 00:19:42,240
Speaker 3: single family rents and there's on average we're up six percent.

347
00:19:42,800 --> 00:19:46,000
Speaker 3: And so I think it's important to remember that there

348
00:19:46,080 --> 00:19:49,720
Speaker 3: is a bifurcation happening throughout all of housing right now,

349
00:19:50,160 --> 00:19:53,280
Speaker 3: and on one of those fault lines is multi versus

350
00:19:53,280 --> 00:19:57,560
Speaker 3: single family and single family it appears, and at least

351
00:19:57,760 --> 00:19:59,800
Speaker 3: among a lot of the investors I also talk to,

352
00:20:00,280 --> 00:20:03,600
Speaker 3: they think there is upward momentum on single family rents.

353
00:20:04,440 --> 00:20:08,000
Speaker 3: And you know, so the last time that the cost

354
00:20:08,119 --> 00:20:11,960
Speaker 3: to buy versus rent got this strained, which right now

355
00:20:12,280 --> 00:20:16,320
Speaker 3: a new monthly mortgage is substantially more expensive than renting

356
00:20:16,359 --> 00:20:18,760
Speaker 3: the same home in most of the country right now.

357
00:20:19,240 --> 00:20:24,160
Speaker 3: The last time that happened was six seven eight, and

358
00:20:24,680 --> 00:20:30,080
Speaker 3: the gap there closed very quickly because house prices crashed

359
00:20:30,440 --> 00:20:34,960
Speaker 3: and rents continued to rise. Now, maybe they're looking through

360
00:20:35,040 --> 00:20:37,560
Speaker 3: rose collared glasses, but a lot of them think that

361
00:20:37,600 --> 00:20:40,760
Speaker 3: there isn't going to be the downward momentum on house

362
00:20:40,840 --> 00:20:44,360
Speaker 3: prices because this time we don't have the toxic mortgages,

363
00:20:44,720 --> 00:20:47,000
Speaker 3: think the ninja loons, we don't have that this time

364
00:20:47,359 --> 00:20:50,800
Speaker 3: like we did in the lead up to THEA crash

365
00:20:50,920 --> 00:20:53,080
Speaker 3: and also in the lead up to the OA crash.

366
00:20:53,880 --> 00:20:58,720
Speaker 3: Active listings inventory had been building for several years and

367
00:20:58,760 --> 00:21:02,160
Speaker 3: there were substantially more on the market, and then when

368
00:21:02,160 --> 00:21:05,000
Speaker 3: you had the foreclosure crisis that occurred in the job

369
00:21:05,040 --> 00:21:09,400
Speaker 3: loss recession, it created this perfect storm to pull house

370
00:21:09,400 --> 00:21:14,160
Speaker 3: prices down. Industry experts now think that's less likely for

371
00:21:14,320 --> 00:21:18,800
Speaker 3: you know, a material correction in house prices, and they're

372
00:21:18,840 --> 00:21:21,840
Speaker 3: talking on a national basis, but they think it's more

373
00:21:22,000 --> 00:21:26,359
Speaker 3: likely that rents will do the work to help to

374
00:21:26,480 --> 00:21:30,119
Speaker 3: narrow the gap. And again, maybe that's rose colored glasses,

375
00:21:30,480 --> 00:21:34,919
Speaker 3: but at least that's the of you that shared a

376
00:21:34,960 --> 00:21:38,400
Speaker 3: lot among the industry. And again i'm talking single family here.

377
00:21:38,800 --> 00:21:41,919
Speaker 3: Multi is a very different story, and there's a tremendous

378
00:21:41,920 --> 00:21:45,360
Speaker 3: amount of supply on the multi family side that's still

379
00:21:45,400 --> 00:21:48,280
Speaker 3: making its way into the market over not just the

380
00:21:48,320 --> 00:21:52,199
Speaker 3: next you know, the last six months, but really twelve

381
00:21:53,040 --> 00:21:54,040
Speaker 3: eighteen months out.

382
00:21:54,119 --> 00:21:57,560
Speaker 2: Still sure that being said, there are still some markets

383
00:21:57,560 --> 00:22:00,919
Speaker 2: that have seen some declines and will actually ask you

384
00:22:00,960 --> 00:22:03,840
Speaker 2: about that as well as some other wisdom hopefully that

385
00:22:03,880 --> 00:22:05,840
Speaker 2: we can give to our listeners on how it is

386
00:22:05,880 --> 00:22:08,159
Speaker 2: that they can go about purchasing a home, especially for

387
00:22:08,200 --> 00:22:10,080
Speaker 2: those first time home buyers. And we'll get to all

388
00:22:10,080 --> 00:22:11,520
Speaker 2: of that right after this.

389
00:22:19,840 --> 00:22:21,680
Speaker 1: Are we're back from the break, we're still talking about

390
00:22:21,720 --> 00:22:26,320
Speaker 1: traversing a broken housing market with expert Lance Lambert. And Lance,

391
00:22:26,600 --> 00:22:29,639
Speaker 1: let's talk about kind of the You've mentioned the term bifurcation.

392
00:22:29,760 --> 00:22:32,720
Speaker 1: And one of the interesting things all real estate is local, right,

393
00:22:32,760 --> 00:22:36,560
Speaker 1: and that can be hyper local in for instance, in

394
00:22:37,000 --> 00:22:40,040
Speaker 1: Atlanta where we live, like certain parts of Atlanta have

395
00:22:40,080 --> 00:22:43,400
Speaker 1: seen outside growth, other parts have seen not nearly as much.

396
00:22:43,720 --> 00:22:45,919
Speaker 1: Or that can be kind of town to town. Some

397
00:22:46,080 --> 00:22:49,600
Speaker 1: towns were boomtowns during COVID. You mentioned Boise and Austin

398
00:22:49,680 --> 00:22:52,960
Speaker 1: being a couple of those. There's a bifurcation there, right,

399
00:22:53,000 --> 00:22:55,840
Speaker 1: some of those. I think you equated Austin to being

400
00:22:55,880 --> 00:22:59,080
Speaker 1: like a meme stock the way kind of it shot

401
00:22:59,160 --> 00:23:02,000
Speaker 1: up in value all around Austin. I saw all these

402
00:23:02,040 --> 00:23:04,560
Speaker 1: investors talking about how they were buying up all this

403
00:23:04,600 --> 00:23:08,040
Speaker 1: stuff in Austin. Well, now Austin is seeing a decline

404
00:23:08,080 --> 00:23:09,840
Speaker 1: when other parts of the country are not.

405
00:23:10,000 --> 00:23:11,920
Speaker 2: Is that correct? Can you talk about kind of the

406
00:23:12,640 --> 00:23:14,040
Speaker 2: local realities of real estate?

407
00:23:14,280 --> 00:23:19,679
Speaker 3: Yeah, that's right. So on a national basis, houseprices since

408
00:23:20,160 --> 00:23:23,200
Speaker 3: you know, the twenty twenty two peak, you know, they

409
00:23:23,240 --> 00:23:26,480
Speaker 3: started to correct a bit in the second half of

410
00:23:26,480 --> 00:23:30,280
Speaker 3: twenty twenty two, down let's say four or five percent

411
00:23:31,240 --> 00:23:35,400
Speaker 3: according to Key Schiller and Freddie Mack. But they then

412
00:23:35,560 --> 00:23:39,280
Speaker 3: rebounded in the first half of twenty and twenty three

413
00:23:39,400 --> 00:23:42,080
Speaker 3: this year and kind of made up for the gains

414
00:23:42,080 --> 00:23:45,720
Speaker 3: that fell off. So on a national basis, houseprices have

415
00:23:45,800 --> 00:23:50,920
Speaker 3: kind of been frozen essentially since you know, Summer A

416
00:23:50,960 --> 00:23:53,880
Speaker 3: twenty twenty two. They gave up some, then they rebounded.

417
00:23:54,200 --> 00:23:56,359
Speaker 3: But really, if you look at these different indices, we

418
00:23:56,480 --> 00:23:59,760
Speaker 3: might be up one two percent a half a percent

419
00:24:00,000 --> 00:24:02,719
Speaker 3: since the twenty twenty two peak based on the end

420
00:24:02,720 --> 00:24:05,960
Speaker 3: of cy you look at. But on a regional basis,

421
00:24:06,000 --> 00:24:10,199
Speaker 3: the bifurcation has been really historic. So we've had some

422
00:24:10,400 --> 00:24:16,680
Speaker 3: markets like Hartford, Connecticut, where house prices are up about

423
00:24:16,760 --> 00:24:20,480
Speaker 3: eight percent nine percent since the twenty twenty two peak,

424
00:24:21,040 --> 00:24:24,639
Speaker 3: and then you have markets like Austin, Texas that, at

425
00:24:24,720 --> 00:24:27,720
Speaker 3: least according to the latest Zillow data is down eighteen

426
00:24:27,840 --> 00:24:31,600
Speaker 3: percent from the peak. Now slimendoses have them down closer

427
00:24:31,600 --> 00:24:35,359
Speaker 3: to fourteen or thirteen percent. But Austin has seen a

428
00:24:35,400 --> 00:24:39,320
Speaker 3: material correction in house prices. Now they're still up a lot.

429
00:24:39,400 --> 00:24:43,200
Speaker 3: Austin's still up like forty two forty percent since March

430
00:24:43,240 --> 00:24:47,480
Speaker 3: twenty twenty. But what happened is in the first twenty

431
00:24:47,520 --> 00:24:50,800
Speaker 3: four months of the pandemic, say, they were up about

432
00:24:50,840 --> 00:24:55,399
Speaker 3: sixty eight seventy percent for prices, and so Austin just

433
00:24:55,440 --> 00:24:57,480
Speaker 3: got ahead of its you know, it got ahead of

434
00:24:57,480 --> 00:25:00,560
Speaker 3: its skis. Prices went up too much. There was a

435
00:25:00,600 --> 00:25:03,440
Speaker 3: lot of investors pouring in, a lot of people moving

436
00:25:03,480 --> 00:25:09,280
Speaker 3: in from California during the pandemic remote work period, the

437
00:25:09,320 --> 00:25:13,160
Speaker 3: lockdowns that just did you know, Austin seemed cheap to them.

438
00:25:13,200 --> 00:25:16,280
Speaker 3: So they were driving up prices just really fast and

439
00:25:16,359 --> 00:25:20,480
Speaker 3: too far beyond local fundamentals. And by the time mortgage

440
00:25:20,560 --> 00:25:24,280
Speaker 3: rates started to move up, Austin on a historical basis

441
00:25:24,400 --> 00:25:29,120
Speaker 3: was overvalued, according to Moody's analytics, by about sixty percent

442
00:25:29,560 --> 00:25:34,280
Speaker 3: from historical fundamentals, and so that strained fundamentals and the

443
00:25:34,320 --> 00:25:37,840
Speaker 3: fact that locals just could no longer really afford a home,

444
00:25:38,240 --> 00:25:40,560
Speaker 3: and then you had fewer the people from the outside

445
00:25:41,680 --> 00:25:45,639
Speaker 3: pouring in, and you know, and investors kind of also

446
00:25:45,680 --> 00:25:48,360
Speaker 3: got over their ski. So we're going through that correction

447
00:25:48,480 --> 00:25:52,440
Speaker 3: in Austin, and it really started summer in twenty twenty two,

448
00:25:53,000 --> 00:25:56,560
Speaker 3: and it's carried over to now and we're in the

449
00:25:56,600 --> 00:26:00,600
Speaker 3: seasonal saw period for twenty twenty three. I would expect

450
00:26:00,600 --> 00:26:04,240
Speaker 3: these next few months to still be fairly soft for Austin.

451
00:26:04,040 --> 00:26:06,440
Speaker 1: Isn't Isn't that the sign, at least to a certain extent,

452
00:26:06,520 --> 00:26:09,320
Speaker 1: lance of a healthy market that some a market can

453
00:26:09,320 --> 00:26:12,200
Speaker 1: get out over at keys and then maybe the speculators,

454
00:26:12,240 --> 00:26:14,280
Speaker 1: the people who go in and buy top dollar banking

455
00:26:14,320 --> 00:26:18,720
Speaker 1: on like continued ridiculous growth, they're the ones who get burned, right,

456
00:26:18,760 --> 00:26:19,840
Speaker 1: That is what happens.

457
00:26:19,840 --> 00:26:20,240
Speaker 2: Oftentimes.

458
00:26:20,240 --> 00:26:21,720
Speaker 1: I feel like I'm, like I said, I'm seeing some

459
00:26:21,760 --> 00:26:25,199
Speaker 1: investors being like a year ago, Austin, Austin, Austin, and

460
00:26:25,240 --> 00:26:27,160
Speaker 1: now some of those folks who bought at the peak,

461
00:26:27,480 --> 00:26:29,840
Speaker 1: they're having a tough time. And not that I wish

462
00:26:29,880 --> 00:26:32,040
Speaker 1: that on them, but I feel like there is a

463
00:26:32,080 --> 00:26:36,120
Speaker 1: reality as an investor that you have to be thoughtful about,

464
00:26:36,160 --> 00:26:38,000
Speaker 1: like the long term approach, and if you're buying hoping

465
00:26:38,000 --> 00:26:39,639
Speaker 1: to make a quick buck, you might lose out.

466
00:26:39,840 --> 00:26:42,440
Speaker 3: Yeah, And I think you hit the nail on the head,

467
00:26:42,480 --> 00:26:46,959
Speaker 3: which is that housing is not a meme stock. And

468
00:26:47,080 --> 00:26:50,040
Speaker 3: what we have seen in the first two years of

469
00:26:50,080 --> 00:26:53,919
Speaker 3: the pandemic, that level of house price growth that was unhealthy.

470
00:26:54,119 --> 00:26:56,199
Speaker 3: We do not want to see that. That is that

471
00:26:56,240 --> 00:26:58,440
Speaker 3: is not good. Now, maybe if you're an investor, maybe

472
00:26:58,440 --> 00:27:00,639
Speaker 3: you kind of liked to have seen that, but you

473
00:27:00,680 --> 00:27:04,480
Speaker 3: know it's not sustainable long term to have that. And

474
00:27:04,800 --> 00:27:08,919
Speaker 3: I think one of the telltale signs of trouble in

475
00:27:08,920 --> 00:27:11,320
Speaker 3: a real estate market is when you start talking to

476
00:27:11,440 --> 00:27:15,000
Speaker 3: investors and you start finding out that they are buying

477
00:27:15,160 --> 00:27:20,080
Speaker 3: homes that will cash flow. That means the revenue they

478
00:27:20,119 --> 00:27:23,600
Speaker 3: will make on a monthly basis is less than what

479
00:27:23,680 --> 00:27:26,879
Speaker 3: they can charge in rent. And so that's what you know,

480
00:27:26,960 --> 00:27:29,159
Speaker 3: people like Michael Zuber over at one rent a lot

481
00:27:29,200 --> 00:27:33,240
Speaker 3: a time call an alligator property, meaning it's costing the

482
00:27:33,280 --> 00:27:37,080
Speaker 3: investor money every month. And if an investor has two, three,

483
00:27:37,240 --> 00:27:40,920
Speaker 3: four of those, that that that's a lot of money

484
00:27:40,920 --> 00:27:44,879
Speaker 3: going out a month. Now, an investor might be doing

485
00:27:44,920 --> 00:27:49,240
Speaker 3: that because they're saying to themselves Wow, look at how

486
00:27:49,280 --> 00:27:52,280
Speaker 3: fast home prices are going up. I'm going to make

487
00:27:52,320 --> 00:27:54,640
Speaker 3: a fortune if I just hold these, even if I'm

488
00:27:54,640 --> 00:27:58,520
Speaker 3: burning money every month. But what happens is into a

489
00:27:58,560 --> 00:28:03,639
Speaker 3: housing correction once the fundamentals have gone too far and

490
00:28:04,320 --> 00:28:07,400
Speaker 3: there's too many of that, you know, the investors who

491
00:28:07,480 --> 00:28:12,480
Speaker 3: bought their speculating like that. It can put downward momentum

492
00:28:12,560 --> 00:28:15,480
Speaker 3: on a market. And I think that's what's happening in Austin.

493
00:28:15,680 --> 00:28:19,120
Speaker 3: And I had been talking to investors in real estate

494
00:28:19,160 --> 00:28:22,000
Speaker 3: agents who had told me they were seeing alligator properties

495
00:28:22,000 --> 00:28:25,720
Speaker 3: occurring where Austin had not just went up sixty eight

496
00:28:25,760 --> 00:28:28,159
Speaker 3: percent over the past in the first two years of

497
00:28:28,160 --> 00:28:31,760
Speaker 3: the pandemic, but if you zoom out, Austin was one

498
00:28:31,760 --> 00:28:34,360
Speaker 3: of the few markets that did not bust following eight

499
00:28:34,400 --> 00:28:37,880
Speaker 3: They only fell like eight percent during the eight crash error,

500
00:28:38,560 --> 00:28:41,160
Speaker 3: and they had climbed up like two hundred and twenty

501
00:28:41,200 --> 00:28:44,480
Speaker 3: percent over the past ten years. So investors who were

502
00:28:44,480 --> 00:28:47,400
Speaker 3: in that market made a fortune. Then there was a

503
00:28:47,400 --> 00:28:50,160
Speaker 3: big run up occurring during the pandemic, and there was

504
00:28:50,360 --> 00:28:53,160
Speaker 3: just that fomo that occurred where it's like, oh, you

505
00:28:53,240 --> 00:28:56,520
Speaker 3: can't miss in Austin. This city, is you know, taking

506
00:28:56,600 --> 00:28:59,360
Speaker 3: off and even if I can't make the money up

507
00:28:59,400 --> 00:29:02,680
Speaker 3: in rent, you know, throwing one hundred bucks a month

508
00:29:02,800 --> 00:29:05,200
Speaker 3: or two hundred a month on these homes isn't going

509
00:29:05,240 --> 00:29:07,320
Speaker 3: to hurt me because I'm making it up on the appreciation.

510
00:29:07,800 --> 00:29:12,160
Speaker 3: And once the music stops, that's when you have trouble,

511
00:29:12,160 --> 00:29:13,280
Speaker 3: and that's what's occurred in US.

512
00:29:13,320 --> 00:29:16,880
Speaker 2: Sure sure, Well, forget the speculators and like even forget

513
00:29:16,880 --> 00:29:20,320
Speaker 2: the investors. What about just the honest, good folks that

514
00:29:20,360 --> 00:29:22,280
Speaker 2: are trying to buy a home. What would you say

515
00:29:22,280 --> 00:29:24,479
Speaker 2: to our listeners out there? They want to buy their

516
00:29:24,520 --> 00:29:26,840
Speaker 2: first place, and they've been saving up, but they're nervous

517
00:29:26,920 --> 00:29:29,320
Speaker 2: that they might make their purchase and then we might

518
00:29:29,360 --> 00:29:33,400
Speaker 2: see a meaningful correction or even years without any price growth.

519
00:29:33,800 --> 00:29:36,360
Speaker 2: Do you think that that's a legit worry for those

520
00:29:36,360 --> 00:29:38,440
Speaker 2: folks who are buying for more personal reasons, or is

521
00:29:38,440 --> 00:29:40,920
Speaker 2: that something that they probably shouldn't be too concerned about.

522
00:29:41,000 --> 00:29:42,960
Speaker 3: I want to start off with one thing, which is

523
00:29:43,440 --> 00:29:47,400
Speaker 3: I cover mortgage rate forecast and house price forecast, and

524
00:29:47,440 --> 00:29:50,400
Speaker 3: I do it religiously, and in my opinion, I don't

525
00:29:50,400 --> 00:29:53,080
Speaker 3: think anybody in the country tracks down more housing and

526
00:29:53,160 --> 00:29:56,280
Speaker 3: mortgage rate forecast than I do, and I will tell

527
00:29:56,320 --> 00:29:58,960
Speaker 3: you we have been through a three year period where

528
00:29:59,000 --> 00:30:02,520
Speaker 3: they are missing less and right in every direction. And

529
00:30:02,680 --> 00:30:04,960
Speaker 3: I think the experts have really gotten house prices and

530
00:30:05,000 --> 00:30:08,320
Speaker 3: mortgage rates wrong over the past couple of years. I

531
00:30:08,320 --> 00:30:12,880
Speaker 3: think it's a lot of it's because of the unpreceded

532
00:30:14,520 --> 00:30:17,240
Speaker 3: you know, things that occurred during the pandemic, with the lockdowns,

533
00:30:17,280 --> 00:30:20,719
Speaker 3: the amount of stimulus money, how low rates went, you know,

534
00:30:20,840 --> 00:30:24,160
Speaker 3: the inflationary shock. All of that plus work from home

535
00:30:24,280 --> 00:30:26,920
Speaker 3: has made it really hard to predict. So the first

536
00:30:26,920 --> 00:30:29,920
Speaker 3: thing I want to say is I'm not sure anybody

537
00:30:29,960 --> 00:30:33,440
Speaker 3: really quite knows where house prices and mortgage rates are

538
00:30:33,440 --> 00:30:35,920
Speaker 3: going to go in the next six months, twelve months,

539
00:30:36,320 --> 00:30:39,560
Speaker 3: let alone three four years. So that's the first part

540
00:30:39,680 --> 00:30:42,360
Speaker 3: is I think the forecast have really struggled here, and

541
00:30:42,400 --> 00:30:44,040
Speaker 3: I don't want to make a prediction on the house

542
00:30:44,040 --> 00:30:48,000
Speaker 3: prices and rates. The second thing is I try to

543
00:30:48,000 --> 00:30:50,720
Speaker 3: not get into this game of is it a good

544
00:30:50,720 --> 00:30:52,640
Speaker 3: time to buy? Is it a bad time to buy.

545
00:30:53,120 --> 00:30:57,320
Speaker 3: My view is that there's always somebody that it is

546
00:30:57,360 --> 00:30:59,880
Speaker 3: a good time to buy, and there was always somebody

547
00:31:00,040 --> 00:31:02,160
Speaker 3: that it's a bad time to buy, and it really

548
00:31:02,200 --> 00:31:07,320
Speaker 3: comes down to personal financial circumstances. And I think the

549
00:31:07,440 --> 00:31:10,240
Speaker 3: number one thing to do if you want to become

550
00:31:10,240 --> 00:31:14,440
Speaker 3: a homeowner is to really work on your personal wealth,

551
00:31:14,840 --> 00:31:20,160
Speaker 3: your personal income, job prospects, entrepreneurial prospects, and then also

552
00:31:20,280 --> 00:31:23,840
Speaker 3: your relationships. You know, the number one thing that drives

553
00:31:23,880 --> 00:31:26,560
Speaker 3: people to have to sell is they have a divorce

554
00:31:27,560 --> 00:31:31,760
Speaker 3: or a job relocation. And so I think it really,

555
00:31:31,960 --> 00:31:34,480
Speaker 3: you know, housing is a little bit less on trying

556
00:31:34,480 --> 00:31:38,160
Speaker 3: to gain mortgage rates and house prices and more on

557
00:31:38,840 --> 00:31:43,640
Speaker 3: trying to work on yourself, on your personal financial circumstances

558
00:31:43,680 --> 00:31:45,600
Speaker 3: and also, you know, your relationship.

559
00:31:45,800 --> 00:31:47,479
Speaker 1: I one hundred percent agree with you. I think the

560
00:31:47,520 --> 00:31:49,840
Speaker 1: one the one caveat I would throw in there is

561
00:31:49,960 --> 00:31:53,400
Speaker 1: just you might want to have a longer timeline of

562
00:31:53,480 --> 00:31:56,240
Speaker 1: ownership for the house that you buy. Typically maybe five

563
00:31:56,240 --> 00:31:58,080
Speaker 1: to seven years is good enough. Like I think I'm

564
00:31:58,080 --> 00:32:00,840
Speaker 1: gonna stay here for that long, but now maybe the

565
00:32:01,160 --> 00:32:05,400
Speaker 1: upper end of that timeline is important, baby saying, I

566
00:32:05,520 --> 00:32:07,479
Speaker 1: will I'm okay being in this house seven to ten

567
00:32:07,560 --> 00:32:10,160
Speaker 1: years if there's a correction that I'm not expecting. Can

568
00:32:10,200 --> 00:32:12,280
Speaker 1: you talk about talk about mortgage rates for just a second,

569
00:32:12,360 --> 00:32:14,080
Speaker 1: land so you talked about how difficult it is to

570
00:32:14,120 --> 00:32:16,160
Speaker 1: predict where they're going. But I guess one thing that

571
00:32:16,200 --> 00:32:18,600
Speaker 1: we can see in the data is the difference between

572
00:32:19,000 --> 00:32:22,000
Speaker 1: rates on like thirty year fixed rate mortgages and adjustable

573
00:32:22,080 --> 00:32:25,520
Speaker 1: rate mortgages and adjustable rate mortgages for a lot of

574
00:32:25,600 --> 00:32:28,480
Speaker 1: years we're just kind of like silly to really even

575
00:32:28,480 --> 00:32:30,200
Speaker 1: think about, because like, well, if I can lock in

576
00:32:30,520 --> 00:32:32,640
Speaker 1: a thirty year mortgage at three and a quarter, why

577
00:32:32,640 --> 00:32:34,720
Speaker 1: am I going to look at the adjustable rate mortgage

578
00:32:34,760 --> 00:32:37,720
Speaker 1: and even chance it? But now as rates have ticked

579
00:32:37,760 --> 00:32:39,760
Speaker 1: up and the gap has grown, do they look more

580
00:32:39,800 --> 00:32:40,800
Speaker 1: attractive in your opinion?

581
00:32:41,440 --> 00:32:44,000
Speaker 3: You know, there's nothing wrong with getting a fixed rate

582
00:32:44,120 --> 00:32:48,880
Speaker 3: and then if rates come down refinancing, and you know,

583
00:32:49,000 --> 00:32:52,800
Speaker 3: I'm not sure how enticing the variable rates have been

584
00:32:52,840 --> 00:32:55,280
Speaker 3: to people. If you look at like the Freddie Mac data,

585
00:32:55,400 --> 00:32:58,560
Speaker 3: it hasn't really taken off that much since the rates

586
00:32:58,560 --> 00:33:00,440
Speaker 3: have kind of moved up. But I do think a

587
00:33:00,480 --> 00:33:04,080
Speaker 3: lot of people buying over the past twelve months have

588
00:33:04,240 --> 00:33:06,800
Speaker 3: really thought, you know what, at some point rates will

589
00:33:06,840 --> 00:33:10,880
Speaker 3: probably come down and I'll be able to refine. You know.

590
00:33:10,960 --> 00:33:14,320
Speaker 3: The only thing I would say is what I've been

591
00:33:14,400 --> 00:33:18,520
Speaker 3: saying for a while now, which is take people's mortgage

592
00:33:18,600 --> 00:33:20,880
Speaker 3: rate forecast with a grain of sault. You know, I

593
00:33:20,880 --> 00:33:22,880
Speaker 3: think there was a lot of people last year who

594
00:33:22,960 --> 00:33:25,440
Speaker 3: were telling people, Hey, rates are going to come right

595
00:33:25,480 --> 00:33:28,200
Speaker 3: back down into the forest really quick. Just go ahead

596
00:33:28,240 --> 00:33:30,960
Speaker 3: and buy this home. And so what occurred is a

597
00:33:30,960 --> 00:33:33,600
Speaker 3: lot of people who bought in twenty twenty two thought

598
00:33:33,640 --> 00:33:35,520
Speaker 3: that rates would come down this year and they'd be

599
00:33:35,560 --> 00:33:38,920
Speaker 3: able to refi. Well, what actually occurred is that rates

600
00:33:39,200 --> 00:33:42,360
Speaker 3: went even higher. So on one hand, they didn't get

601
00:33:42,400 --> 00:33:44,800
Speaker 3: to refi. But on the other hand, had they waited

602
00:33:44,920 --> 00:33:47,520
Speaker 3: another year, they would have had to get even a

603
00:33:47,600 --> 00:33:50,680
Speaker 3: higher rate if they bought, and maybe higher house prices

604
00:33:50,680 --> 00:33:53,479
Speaker 3: depending on their market, or maybe lower depending on the market.

605
00:33:54,080 --> 00:33:56,600
Speaker 3: And so I would say take some things with a

606
00:33:56,640 --> 00:33:59,720
Speaker 3: grain of salt, and then, you know, be financially prepared

607
00:34:00,280 --> 00:34:05,040
Speaker 3: to pay whatever you're agreed upon monthly principal and interest

608
00:34:05,120 --> 00:34:09,160
Speaker 3: payment is, if your monthly payment principal and interest is

609
00:34:09,200 --> 00:34:12,239
Speaker 3: twenty eight hundred a month, be prepared financially to pay

610
00:34:12,239 --> 00:34:15,960
Speaker 3: that for a prolonged period or even longer than maybe

611
00:34:15,960 --> 00:34:18,760
Speaker 3: you will actually have to. But I would say mentally,

612
00:34:18,840 --> 00:34:22,160
Speaker 3: prepare yourself to just continue to make that payment and

613
00:34:22,200 --> 00:34:24,880
Speaker 3: then if rates come down and you're able to REFI,

614
00:34:25,280 --> 00:34:28,520
Speaker 3: you know, treat it as like a financial blessing instead

615
00:34:28,520 --> 00:34:29,200
Speaker 3: of a guarantee.

616
00:34:29,200 --> 00:34:30,080
Speaker 2: No, I think that's great advice.

617
00:34:30,080 --> 00:34:32,680
Speaker 1: I think too many people are being told, also by

618
00:34:32,680 --> 00:34:36,560
Speaker 1: real estate professionals, whether it's a realtor or a mortgage broker, Hey, no,

619
00:34:36,680 --> 00:34:38,319
Speaker 1: you're totally gonna be able to refinance. The next year

620
00:34:38,400 --> 00:34:39,839
Speaker 1: is not gonna be prob You're gonna save two points

621
00:34:39,840 --> 00:34:41,759
Speaker 1: and this is gonna save you this much on your

622
00:34:41,760 --> 00:34:44,839
Speaker 1: monthly payment. And people are buying the home saying, all right,

623
00:34:44,880 --> 00:34:45,759
Speaker 1: I can slog through it.

624
00:34:45,719 --> 00:34:46,200
Speaker 2: For a year.

625
00:34:46,520 --> 00:34:49,399
Speaker 1: But then maybe that's that's not the case, Like you said,

626
00:34:49,600 --> 00:34:51,799
Speaker 1: maybe rates keep going up. Where do they go from here?

627
00:34:51,920 --> 00:34:54,520
Speaker 1: Who knows? That's anybody's guest. But Lance, we've got a

628
00:34:54,520 --> 00:34:55,920
Speaker 1: couple more questions. When we get to Grant and I

629
00:34:55,960 --> 00:34:58,840
Speaker 1: mentioned realtors, We specifically want to talk about that recent

630
00:34:59,000 --> 00:35:02,440
Speaker 1: ruling and how that might the ruling a court, about

631
00:35:02,480 --> 00:35:06,280
Speaker 1: how that might impact realtor fees and maybe saving consumers

632
00:35:06,280 --> 00:35:07,960
Speaker 1: a lot of money. We'll talk a little bit more

633
00:35:07,960 --> 00:35:08,920
Speaker 1: with Lance right after this.

634
00:35:17,920 --> 00:35:21,080
Speaker 2: We are back again. We're talking with Lance Lambert formally

635
00:35:21,080 --> 00:35:25,160
Speaker 2: with Fortune now has launched Rezi Club and Lance, let's

636
00:35:25,160 --> 00:35:28,040
Speaker 2: talk about realtors specifically. We wanted to mention like that

637
00:35:28,200 --> 00:35:32,840
Speaker 2: recent legal ruling against the National Association of Realtors, Like

638
00:35:32,880 --> 00:35:35,440
Speaker 2: it seems like the fallout from this could be pretty massive,

639
00:35:36,360 --> 00:35:38,239
Speaker 2: not only for real estate agents and what it is

640
00:35:38,239 --> 00:35:40,799
Speaker 2: that they earn, but also for buyers and sellers. The

641
00:35:40,960 --> 00:35:45,040
Speaker 2: amounts that consumers could save would be a significant amount

642
00:35:45,120 --> 00:35:47,000
Speaker 2: of money. Do you have some thoughts.

643
00:35:46,719 --> 00:35:50,320
Speaker 3: There, Yeah, So, a couple of weeks ago, a Missouri jury,

644
00:35:50,320 --> 00:35:56,120
Speaker 3: a federal case, they awarded the plaintiffs in the sits

645
00:35:56,680 --> 00:36:01,880
Speaker 3: Or Burnett Buyer Broker Commission Action lawsuit around like I

646
00:36:01,880 --> 00:36:05,080
Speaker 3: think it was one point seven eight billion in damages,

647
00:36:05,480 --> 00:36:08,960
Speaker 3: and that was against Keller Williams Home Services of America

648
00:36:09,360 --> 00:36:12,759
Speaker 3: and the National Association of Realtors, and they accused them

649
00:36:12,760 --> 00:36:17,960
Speaker 3: of conspiring to inflate commission rates, and the jury agreed.

650
00:36:18,640 --> 00:36:22,160
Speaker 3: And so essentially how real estate has worked for a

651
00:36:22,160 --> 00:36:25,320
Speaker 3: really long time is that there's a three percent fee

652
00:36:26,080 --> 00:36:28,880
Speaker 3: for the buyer's agent and then a three percent fee

653
00:36:29,280 --> 00:36:32,280
Speaker 3: for the seller's agent, so six percent of the total

654
00:36:33,640 --> 00:36:37,440
Speaker 3: sale price, and usually that has always been paid by

655
00:36:37,560 --> 00:36:41,200
Speaker 3: the seller and the seller's kind of been stuck paying

656
00:36:41,280 --> 00:36:45,439
Speaker 3: the buyer's agent. And I think, you know, it's caused

657
00:36:45,440 --> 00:36:48,759
Speaker 3: a lot of frustration every years, and there have been

658
00:36:48,800 --> 00:36:52,440
Speaker 3: ways to get around it. But the accusation that the

659
00:36:53,200 --> 00:36:55,279
Speaker 3: you know, the plaintiffs made in this case is that,

660
00:36:55,760 --> 00:36:59,400
Speaker 3: you know, the agents and National Association of Realtors was

661
00:36:59,480 --> 00:37:03,400
Speaker 3: essentially acting as like a cartel, forcing people into this

662
00:37:03,480 --> 00:37:06,960
Speaker 3: type of agreement. And I think what comes out of

663
00:37:06,960 --> 00:37:10,520
Speaker 3: this and my opinion is I think that ruling was

664
00:37:10,560 --> 00:37:15,120
Speaker 3: an earthquake felt by the industry, and I think now

665
00:37:15,560 --> 00:37:19,000
Speaker 3: we're just going to figure out was it a small

666
00:37:19,080 --> 00:37:22,439
Speaker 3: quake or was it the first tremor and something much

667
00:37:22,520 --> 00:37:25,000
Speaker 3: much bigger. And so what's going to occur from here

668
00:37:25,160 --> 00:37:28,560
Speaker 3: is years of lawsuits. There's going to be lawsuits against

669
00:37:28,760 --> 00:37:32,600
Speaker 3: numerous organizations, and we're gonna have to kind of figure

670
00:37:32,640 --> 00:37:38,000
Speaker 3: out how this does or doesn't change the real estate industry.

671
00:37:38,080 --> 00:37:41,680
Speaker 3: I think for the immediate Byron Byron seller, it probably

672
00:37:41,760 --> 00:37:45,719
Speaker 3: isn't having necessarily a huge impact because we you know,

673
00:37:45,920 --> 00:37:49,960
Speaker 3: I mean, the judge still kind of has to rule

674
00:37:50,000 --> 00:37:53,000
Speaker 3: on the case, and it's already going to be appealed.

675
00:37:54,200 --> 00:37:58,040
Speaker 3: But I think it's just uncertainty has really been brought

676
00:37:58,040 --> 00:38:00,000
Speaker 3: into the market, and I think it's really been felt

677
00:38:00,200 --> 00:38:04,720
Speaker 3: mostly by the industry, unless so by the buyers and sellers,

678
00:38:04,760 --> 00:38:06,920
Speaker 3: and the industry just kind of wants to figure out how,

679
00:38:07,239 --> 00:38:09,920
Speaker 3: you know, how how will this change the rules?

680
00:38:10,040 --> 00:38:12,240
Speaker 1: Well, and let's be honest, the transaction costs for buyers

681
00:38:12,239 --> 00:38:16,200
Speaker 1: and sellers kind of also insulate activity in the housing market.

682
00:38:16,600 --> 00:38:19,520
Speaker 1: And because it is expensive to buy or to sell,

683
00:38:19,560 --> 00:38:21,680
Speaker 1: that's just one other reason maybe to stay put a

684
00:38:21,719 --> 00:38:24,399
Speaker 1: little bit longer. And when you look at worldwide, kind

685
00:38:24,440 --> 00:38:27,840
Speaker 1: of what realtors, the percentage of the transaction that a

686
00:38:27,880 --> 00:38:30,480
Speaker 1: realtor makes like they're they're higher in the United States

687
00:38:30,480 --> 00:38:33,919
Speaker 1: and pretty much anywhere else. So it not that Matt

688
00:38:33,920 --> 00:38:36,200
Speaker 1: and I are against realtors. We love realtors. We've had great

689
00:38:36,239 --> 00:38:39,400
Speaker 1: realtor experiences. But that is I'm curious to see the

690
00:38:39,400 --> 00:38:41,440
Speaker 1: shakeout as well. You actually you talk to the CEO

691
00:38:41,520 --> 00:38:44,400
Speaker 1: of redfinn kind of not too long after that ruling

692
00:38:44,440 --> 00:38:47,120
Speaker 1: came out. What was that like and what's his perspective

693
00:38:47,200 --> 00:38:50,280
Speaker 1: because redfinn Is has kind of been at the forefront

694
00:38:50,520 --> 00:38:54,320
Speaker 1: of trying to reduce broker fees and make home buying

695
00:38:54,400 --> 00:38:55,520
Speaker 1: kind of more consumer friendly.

696
00:38:55,640 --> 00:39:00,479
Speaker 3: Yeah, so before the rolling, you know, they had pulled

697
00:39:00,520 --> 00:39:03,200
Speaker 3: out from the National Association of Realtors. And when I

698
00:39:03,200 --> 00:39:07,680
Speaker 3: say they, I mean Redfin and it was really you know,

699
00:39:07,840 --> 00:39:12,600
Speaker 3: on many fronts, but you know, the sexual harassment allegations

700
00:39:12,640 --> 00:39:17,200
Speaker 3: against the National Association of Realtors, just some complaints about

701
00:39:17,239 --> 00:39:22,480
Speaker 3: how the industry has done things. You know, Glenn over

702
00:39:22,520 --> 00:39:27,160
Speaker 3: at Redfin hasn't felt great about that. But in terms of,

703
00:39:27,440 --> 00:39:29,360
Speaker 3: you know, where things kind of go from here, I

704
00:39:29,400 --> 00:39:31,839
Speaker 3: think Glenn is kind of in the same boat of

705
00:39:31,880 --> 00:39:34,239
Speaker 3: what I said is there's just a lot of uncertainty.

706
00:39:34,600 --> 00:39:38,640
Speaker 3: I think Redfin feels like they are prepared with whatever

707
00:39:38,840 --> 00:39:41,680
Speaker 3: direction it goes. You know, this has obviously been one

708
00:39:41,719 --> 00:39:44,840
Speaker 3: of the things that they've been pushing against the industry,

709
00:39:45,080 --> 00:39:47,160
Speaker 3: and they've kind of tried to be a discount a

710
00:39:47,200 --> 00:39:53,279
Speaker 3: discount player in the space. And then you know Glenn's view,

711
00:39:53,320 --> 00:39:55,520
Speaker 3: I asked him if he thought the National Association of

712
00:39:55,560 --> 00:40:00,160
Speaker 3: Realtors was a cartel. He didn't say it was a cartel. Well,

713
00:40:00,280 --> 00:40:02,480
Speaker 3: but what he did say is there is a cartel

714
00:40:02,520 --> 00:40:06,160
Speaker 3: in housing in his view, and it's homeowners, he says,

715
00:40:06,880 --> 00:40:11,080
Speaker 3: who have fought against you know, zoning, and they fought

716
00:40:11,120 --> 00:40:16,560
Speaker 3: against new developments for many decades, and you know, in

717
00:40:16,600 --> 00:40:19,760
Speaker 3: his view, that's hurt the housing supply of the market

718
00:40:20,080 --> 00:40:24,400
Speaker 3: and helped to you know, deteriorate affordability. And of course

719
00:40:24,440 --> 00:40:28,040
Speaker 3: that deterioration and affordability is really the thing, you know

720
00:40:28,120 --> 00:40:31,399
Speaker 3: now that people are really up in arms about. So

721
00:40:31,640 --> 00:40:34,040
Speaker 3: I thought it was an interesting conversation with Glenn.

722
00:40:34,120 --> 00:40:35,879
Speaker 1: Yeah, I don't think he's wrong on that, by the way.

723
00:40:35,880 --> 00:40:37,920
Speaker 1: I mean, when you think about there's a lot of nimbiism.

724
00:40:38,000 --> 00:40:40,880
Speaker 1: There's a lot of aversion to changing zoning laws or

725
00:40:40,920 --> 00:40:43,520
Speaker 1: to making it easier to build things. Even fortunately, we've

726
00:40:43,520 --> 00:40:47,400
Speaker 1: seen a lot of uptick in cities municipalities being okay

727
00:40:47,440 --> 00:40:51,000
Speaker 1: with accessory dwelling units, and that is adding some supply,

728
00:40:51,120 --> 00:40:52,759
Speaker 1: but that is a huge problem. Even where Matt and

729
00:40:52,840 --> 00:40:55,000
Speaker 1: I live, there's a proposal to build like one hundred

730
00:40:55,000 --> 00:40:57,359
Speaker 1: and twenty unit apartment building and it's being fought tooth

731
00:40:57,360 --> 00:40:59,560
Speaker 1: and nail by the folks who live in the general vicinity. No,

732
00:40:59,640 --> 00:41:02,279
Speaker 1: we don't this density, we don't want that here. But

733
00:41:02,320 --> 00:41:05,040
Speaker 1: the reality is like while you're insulating and your increasing

734
00:41:05,040 --> 00:41:08,080
Speaker 1: your own property values, you're dooming the next generation to

735
00:41:08,400 --> 00:41:09,600
Speaker 1: exorbit in house prices.

736
00:41:09,840 --> 00:41:15,160
Speaker 3: Yeah, it was interesting to see Glenn call homeowners the

737
00:41:15,200 --> 00:41:19,280
Speaker 3: actual cartel in housing. But yeah, so I think where

738
00:41:19,280 --> 00:41:23,680
Speaker 3: we are in housing is that affordability is very deteriorated.

739
00:41:24,040 --> 00:41:28,200
Speaker 3: People are very upset, and the real estate agents are

740
00:41:28,239 --> 00:41:31,920
Speaker 3: probably going to take some punches from the crowd because

741
00:41:31,960 --> 00:41:35,239
Speaker 3: people are just so upset with where housing affordability is.

742
00:41:35,440 --> 00:41:38,040
Speaker 3: And really, I want to also say that this is

743
00:41:38,120 --> 00:41:40,600
Speaker 3: kind of kicking the industry when they're down right now,

744
00:41:41,320 --> 00:41:47,480
Speaker 3: Existing in resale transactions are super low right now. Mortgage

745
00:41:47,480 --> 00:41:51,439
Speaker 3: purchase applications at the end of October early November were

746
00:41:51,520 --> 00:41:55,600
Speaker 3: at the lowest level since nineteen ninety six. So there's

747
00:41:55,760 --> 00:41:58,040
Speaker 3: just not a lot of churn happening in the market

748
00:41:58,120 --> 00:42:00,960
Speaker 3: and there's not a lot of the transaction occurring. So

749
00:42:01,080 --> 00:42:03,239
Speaker 3: I think that's why the industry is also kind of

750
00:42:03,239 --> 00:42:07,759
Speaker 3: frustrated because this is just occurring at a very you know,

751
00:42:08,960 --> 00:42:11,759
Speaker 3: interesting time for them, kind of a low point for them,

752
00:42:12,239 --> 00:42:13,719
Speaker 3: you know, it kind of feels like they're getting kicked

753
00:42:13,719 --> 00:42:14,319
Speaker 3: while they're down.

754
00:42:14,440 --> 00:42:17,000
Speaker 2: Yeah, Okay, so Lancey said, you were really willing to

755
00:42:17,080 --> 00:42:20,719
Speaker 2: make housing price predictions or even rate predictions where you know,

756
00:42:20,800 --> 00:42:23,239
Speaker 2: given where things might be going. What have you been

757
00:42:23,320 --> 00:42:27,120
Speaker 2: hearing from other folks out there who do make predictions, right.

758
00:42:27,120 --> 00:42:29,680
Speaker 3: We will make a little bit of one prediction, which

759
00:42:29,719 --> 00:42:32,959
Speaker 3: is I do believe that the US housing market, which

760
00:42:33,040 --> 00:42:38,160
Speaker 3: since summer twenty twenty two has been very bifurcated regionally,

761
00:42:38,600 --> 00:42:41,680
Speaker 3: I expect that to continue. I think as long as

762
00:42:41,719 --> 00:42:45,160
Speaker 3: there's not a substantial shift in the market, whether that's

763
00:42:45,160 --> 00:42:48,600
Speaker 3: a breaking in labor or a swift moving down in rates.

764
00:42:48,640 --> 00:42:51,360
Speaker 3: So it's like, let's say, all else being equal, like

765
00:42:51,520 --> 00:42:53,560
Speaker 3: we're just kind of where we are today, but for

766
00:42:53,600 --> 00:42:56,480
Speaker 3: a prolonged period, like let's say another twelve months, I

767
00:42:56,480 --> 00:42:59,400
Speaker 3: would expect some markets to see prices fallsom and I

768
00:42:59,400 --> 00:43:02,080
Speaker 3: would expect some other markets to continue to see prices

769
00:43:02,160 --> 00:43:05,440
Speaker 3: raise rise. And I think what would occur is the

770
00:43:05,440 --> 00:43:08,120
Speaker 3: markets that are going to give up some they probably

771
00:43:08,160 --> 00:43:11,640
Speaker 3: will be fairly stale in the spring, and then in

772
00:43:11,719 --> 00:43:15,440
Speaker 3: the seasonally weaker fall periods, that's when they'll kind of

773
00:43:15,440 --> 00:43:17,520
Speaker 3: give up on the prices. And then I think the

774
00:43:17,560 --> 00:43:20,280
Speaker 3: markets that are going to continue to see prices increase,

775
00:43:20,440 --> 00:43:23,799
Speaker 3: like I think Hartford, Connecticut's going higher. I think what

776
00:43:23,840 --> 00:43:27,000
Speaker 3: will happen there is that they'll be pretty stale at

777
00:43:27,000 --> 00:43:29,600
Speaker 3: the end of the years in the falls, and then

778
00:43:29,640 --> 00:43:32,680
Speaker 3: in the springs they'll be kind of bustling and a

779
00:43:32,680 --> 00:43:35,719
Speaker 3: lot of bittingmores because there's just not enough inventory. So

780
00:43:35,840 --> 00:43:38,960
Speaker 3: the thing that I would say to watch three things.

781
00:43:39,360 --> 00:43:43,080
Speaker 3: One the bond market and mortgage rates, because if that

782
00:43:43,200 --> 00:43:46,879
Speaker 3: were to move dramatically in one direct direction or the other,

783
00:43:47,239 --> 00:43:52,320
Speaker 3: that would shift the environment. Two, watch the jobs market,

784
00:43:52,520 --> 00:43:55,640
Speaker 3: watch unemployment. If that were to break one way or

785
00:43:55,719 --> 00:43:58,160
Speaker 3: the other, that could move things as well. And then

786
00:43:58,200 --> 00:44:02,600
Speaker 3: the third thing is watch local inventory levels. Austin, which

787
00:44:02,640 --> 00:44:05,279
Speaker 3: is the market that's giving up on prices, they have

788
00:44:05,360 --> 00:44:10,120
Speaker 3: seen inventory go back to pre pandemic inventory levels, while Hertford,

789
00:44:10,160 --> 00:44:15,080
Speaker 3: Connecticut is down seventy eighty percent for inventory from now

790
00:44:15,200 --> 00:44:18,839
Speaker 3: versus pre pandemic. And so what that means in Hertford, Connecticut,

791
00:44:19,040 --> 00:44:22,120
Speaker 3: for every one home currently on the market in Hertford, Connecticut,

792
00:44:22,320 --> 00:44:25,759
Speaker 3: there were four homes for sale in twenty nineteen, so

793
00:44:26,400 --> 00:44:31,640
Speaker 3: just three homes disappearing from active listings essentially. And so

794
00:44:31,760 --> 00:44:35,160
Speaker 3: how can you track this down to a regional level. Well,

795
00:44:35,320 --> 00:44:38,879
Speaker 3: there's this guy called Lance Lambert that's this newsletter called

796
00:44:38,920 --> 00:44:43,799
Speaker 3: RESI Club and I published this stuff continuously and I

797
00:44:43,920 --> 00:44:46,600
Speaker 3: look at it very much on a regional level, and

798
00:44:46,719 --> 00:44:49,680
Speaker 3: my view is I've been able to catch every single

799
00:44:49,960 --> 00:44:52,680
Speaker 3: price correction that has occurred in the US down to

800
00:44:52,719 --> 00:44:56,640
Speaker 3: a county level over the past eighteen months based on

801
00:44:56,760 --> 00:45:00,719
Speaker 3: how I kind of watch active listing data. And so

802
00:45:00,840 --> 00:45:04,440
Speaker 3: if you would really like the metro and county level

803
00:45:04,760 --> 00:45:06,640
Speaker 3: and even some of the zip code data that I'm

804
00:45:06,680 --> 00:45:08,719
Speaker 3: still kind of working on because I just launched this

805
00:45:08,760 --> 00:45:12,040
Speaker 3: four weeks ago, But if you would like that, subscribe

806
00:45:12,040 --> 00:45:15,560
Speaker 3: to Resie Club and then the premium membership is where

807
00:45:15,680 --> 00:45:18,120
Speaker 3: I really give a lot of this robust data. And

808
00:45:18,160 --> 00:45:20,879
Speaker 3: that's one hundred and fifty dollars a year to get

809
00:45:20,920 --> 00:45:24,680
Speaker 3: access to my Lance Labert House Price Tracker and Lance

810
00:45:24,719 --> 00:45:26,040
Speaker 3: Lambert Inventory Tracker.

811
00:45:26,160 --> 00:45:26,399
Speaker 2: Lance.

812
00:45:26,440 --> 00:45:30,560
Speaker 1: It's great information, man, Like I as a like an

813
00:45:30,680 --> 00:45:32,879
Speaker 1: armchair quarterback on this stuff, like I like to nerd

814
00:45:32,920 --> 00:45:35,320
Speaker 1: out on it. I want to hear it, like aggregate

815
00:45:35,360 --> 00:45:38,239
Speaker 1: expert information. And you do such a great job of

816
00:45:38,239 --> 00:45:41,719
Speaker 1: compiling that and sending it out. Like in a world

817
00:45:41,800 --> 00:45:45,000
Speaker 1: that is newsletter heavy, yours is one that I read

818
00:45:45,040 --> 00:45:46,920
Speaker 1: with regularity. So thank you for what you do and

819
00:45:47,200 --> 00:45:49,120
Speaker 1: what is there anything else. You want our listeners to

820
00:45:49,200 --> 00:45:51,319
Speaker 1: know about you and what you're up to before we

821
00:45:51,800 --> 00:45:52,440
Speaker 1: say goodbye.

822
00:45:52,560 --> 00:45:54,600
Speaker 3: The other thing I would say about Resie Club is

823
00:45:54,680 --> 00:45:57,040
Speaker 3: so I have that pro offering, which is for people

824
00:45:57,040 --> 00:46:00,399
Speaker 3: who really want to get the regional data, for people

825
00:46:00,440 --> 00:46:02,239
Speaker 3: who don't want to pay for pro and they just

826
00:46:02,360 --> 00:46:03,920
Speaker 3: kind of want to read my work. I still do

827
00:46:03,960 --> 00:46:06,680
Speaker 3: five articles a week, and a lot of this is

828
00:46:06,760 --> 00:46:09,840
Speaker 3: looking at some of it does have some of the

829
00:46:09,840 --> 00:46:12,520
Speaker 3: regional data. I kind of sprinkle that in. But you know,

830
00:46:12,560 --> 00:46:16,640
Speaker 3: I cover US home builders. I cover institutional home buyers

831
00:46:16,760 --> 00:46:19,359
Speaker 3: better than anybody in the country. I'm really tapped in

832
00:46:19,400 --> 00:46:22,520
Speaker 3: there to what's happening on the institutional side down to

833
00:46:22,600 --> 00:46:25,520
Speaker 3: regional level. And then I also, you know, I cover

834
00:46:25,640 --> 00:46:29,040
Speaker 3: the prop texts, real estate startups. Really, if you kind

835
00:46:29,040 --> 00:46:33,279
Speaker 3: of are really hungry for housing information and what's going

836
00:46:33,320 --> 00:46:36,200
Speaker 3: on with the biggest players in it, I'd say subscribe

837
00:46:36,200 --> 00:46:38,360
Speaker 3: to Rezi Club. You know, I have a lot of

838
00:46:38,360 --> 00:46:39,759
Speaker 3: good content there for free.

839
00:46:39,800 --> 00:46:41,840
Speaker 2: That's right, and you do sprinkle a little bit in

840
00:46:41,880 --> 00:46:44,440
Speaker 2: there to give everyone a little taste of what they

841
00:46:44,480 --> 00:46:48,880
Speaker 2: could be receiving where they'd upgrade. But Lance, thank you

842
00:46:48,920 --> 00:46:51,279
Speaker 2: so much for talking to us. We appreciate you coming on.

843
00:46:51,400 --> 00:46:54,319
Speaker 2: Thank you all right, man Lance Lambert. We were off

844
00:46:54,320 --> 00:46:56,640
Speaker 2: to the races when it came to talking about housing.

845
00:46:56,680 --> 00:46:58,359
Speaker 2: It was like, listen, Lancer's this thing called the craft

846
00:46:58,400 --> 00:47:00,440
Speaker 2: beer equivalent. We have to talk about before we keep

847
00:47:00,480 --> 00:47:02,120
Speaker 2: talking about housing. He's like, we don't have time for

848
00:47:02,200 --> 00:47:05,440
Speaker 2: personal personal banter. We got to talk about the goods. No,

849
00:47:05,560 --> 00:47:09,440
Speaker 2: I really do appreciate man Lance's depth of knowledge and

850
00:47:09,480 --> 00:47:13,000
Speaker 2: his passion for housing real estate here in the US.

851
00:47:13,080 --> 00:47:15,480
Speaker 2: But yeah, did you have a big takeaway from our

852
00:47:15,480 --> 00:47:17,200
Speaker 2: conversation mister Lambert.

853
00:47:17,280 --> 00:47:19,200
Speaker 1: No, he definitely, I mean, he definitely knows a lot right.

854
00:47:19,239 --> 00:47:22,560
Speaker 1: It's it's pretty pretty clear that he studies, eats breeze,

855
00:47:22,640 --> 00:47:25,840
Speaker 1: and sleeps the data about what's going on in the

856
00:47:25,880 --> 00:47:29,040
Speaker 1: housing market, what's going on with interest rates, predictions, prognostications,

857
00:47:29,080 --> 00:47:32,360
Speaker 1: and on that front. My big takeaway was that the

858
00:47:32,400 --> 00:47:34,040
Speaker 1: experts aren't always right, and.

859
00:47:34,000 --> 00:47:35,279
Speaker 2: So sometimes they're wrong.

860
00:47:35,360 --> 00:47:37,600
Speaker 1: What I love about Lance is he's kind of synthesizing

861
00:47:37,600 --> 00:47:39,800
Speaker 1: the data. He's looking at what all the experts are saying,

862
00:47:40,200 --> 00:47:42,640
Speaker 1: and he's kind of saying he's putting his finger to

863
00:47:42,640 --> 00:47:42,919
Speaker 1: the wind.

864
00:47:42,920 --> 00:47:45,920
Speaker 2: Does that seem right? Or when? When I aggregate all

865
00:47:45,960 --> 00:47:47,360
Speaker 2: of these things. Is that true?

866
00:47:47,680 --> 00:47:50,600
Speaker 1: And he basically said, the experts have been badly wrong.

867
00:47:50,960 --> 00:47:53,799
Speaker 1: Understandable too, right, because we've been in like this, a

868
00:47:53,840 --> 00:47:57,040
Speaker 1: really weird economy over the past three years. COVID throw

869
00:47:57,040 --> 00:47:59,640
Speaker 1: a wrench in everybody's predictions about something everything.

870
00:47:59,520 --> 00:48:02,759
Speaker 2: Something that we've never experienced before. Right, So understandable.

871
00:48:02,880 --> 00:48:04,480
Speaker 1: So not not trying to throw shade on some of

872
00:48:04,480 --> 00:48:06,920
Speaker 1: those some of those experts, but it is also important

873
00:48:06,960 --> 00:48:08,880
Speaker 1: to note to not make a decision based on what

874
00:48:08,920 --> 00:48:10,800
Speaker 1: the experts are saying. And I think a lot of

875
00:48:10,800 --> 00:48:14,640
Speaker 1: people have been prone to do that, saying, oh, this

876
00:48:14,680 --> 00:48:16,480
Speaker 1: is the hot market, oh this is oh interest rates

877
00:48:16,480 --> 00:48:17,960
Speaker 1: are definitely going to go down, Well, then I should

878
00:48:18,000 --> 00:48:20,719
Speaker 1: buy and and you have to be careful. And one

879
00:48:20,760 --> 00:48:23,000
Speaker 1: of the things that Lance Lance said is it's all

880
00:48:23,040 --> 00:48:26,360
Speaker 1: about your own personal personal finance situation.

881
00:48:26,480 --> 00:48:29,320
Speaker 2: Hey, you can have multiple big takeaways during this episode

882
00:48:29,320 --> 00:48:30,440
Speaker 2: and I'll let you finish.

883
00:48:30,480 --> 00:48:32,239
Speaker 1: But well, even the thing and I'm going to say

884
00:48:32,239 --> 00:48:34,280
Speaker 1: one more thing, even the thing he's said, Okay, free takeaway.

885
00:48:35,040 --> 00:48:36,759
Speaker 1: Even the thing he said at the end, the three

886
00:48:36,760 --> 00:48:38,759
Speaker 1: things to watch about where the housing market's going. I

887
00:48:38,760 --> 00:48:40,279
Speaker 1: think he spot on. I don't think there are three

888
00:48:40,360 --> 00:48:45,000
Speaker 1: better metrics then mortgage rates, jobs and unemployment, and local inventory.

889
00:48:45,000 --> 00:48:46,520
Speaker 1: If you're trying to figure out what's going to happen

890
00:48:46,520 --> 00:48:48,759
Speaker 1: in your local housing market, not that you can predict it,

891
00:48:49,080 --> 00:48:51,120
Speaker 1: but if you're kind of like looking for an inkling

892
00:48:51,160 --> 00:48:53,160
Speaker 1: of where things are headed, those are the three metrics

893
00:48:53,200 --> 00:48:53,759
Speaker 1: really look at.

894
00:48:53,920 --> 00:48:57,040
Speaker 2: Absolutely. Yeah, My big singular take big takeaway for this

895
00:48:57,120 --> 00:48:59,320
Speaker 2: episode was going to be the fact that I think

896
00:48:59,400 --> 00:49:03,080
Speaker 2: it can be an overwhelming task to think through is

897
00:49:03,160 --> 00:49:05,160
Speaker 2: now the right time for us to move? Is now

898
00:49:05,200 --> 00:49:06,759
Speaker 2: the time that we're going to buy a house? And

899
00:49:06,960 --> 00:49:08,720
Speaker 2: I love what Lane said, And now I was actually

900
00:49:08,760 --> 00:49:11,359
Speaker 2: a little surprised because he is so knee deep into

901
00:49:11,360 --> 00:49:13,200
Speaker 2: the data, but he was able to back out and

902
00:49:13,239 --> 00:49:17,240
Speaker 2: say no, it comes down to your personal circumstances, personal finance.

903
00:49:17,280 --> 00:49:19,160
Speaker 2: That's what we're talking about here. That is at the

904
00:49:19,160 --> 00:49:20,520
Speaker 2: core of what it is that we talk about. And

905
00:49:20,600 --> 00:49:23,000
Speaker 2: I love that he was able to back out and say, well, ultimately,

906
00:49:23,000 --> 00:49:24,400
Speaker 2: at the end of the day, it comes down to

907
00:49:24,440 --> 00:49:28,000
Speaker 2: an individual's ability to make the payments on a property

908
00:49:28,000 --> 00:49:30,080
Speaker 2: that they're looking to purchase. It comes down to so

909
00:49:30,280 --> 00:49:33,000
Speaker 2: many additional things other than whether or not the market's hot,

910
00:49:33,120 --> 00:49:35,880
Speaker 2: where exactly rates are. It comes down to whether or

911
00:49:35,920 --> 00:49:37,879
Speaker 2: not you're going to have a kid, how many kids

912
00:49:37,880 --> 00:49:39,160
Speaker 2: you're going to have in the coming years. It comes

913
00:49:39,160 --> 00:49:41,520
Speaker 2: down to a job relocation, It comes down to wanting

914
00:49:41,560 --> 00:49:44,800
Speaker 2: to be closer to family, because those remaining years perhaps

915
00:49:44,800 --> 00:49:47,560
Speaker 2: to be close to your parents are more important than

916
00:49:47,640 --> 00:49:49,759
Speaker 2: your ability to maybe save a little bit more and

917
00:49:49,800 --> 00:49:53,000
Speaker 2: to achieve, say fire a little more aggressively. A lot

918
00:49:53,000 --> 00:49:55,680
Speaker 2: of intangibles and yeah, there are so many of those

919
00:49:55,719 --> 00:49:58,040
Speaker 2: personal factors that we all have to weigh and there

920
00:49:58,120 --> 00:50:02,040
Speaker 2: is no perfect scale or measure that says, well, if

921
00:50:02,080 --> 00:50:04,759
Speaker 2: it's kids, then that trump's this. No, it comes down

922
00:50:04,800 --> 00:50:06,960
Speaker 2: to the individual. It comes down to each family to

923
00:50:07,000 --> 00:50:08,279
Speaker 2: decide whether it's going to work.

924
00:50:08,360 --> 00:50:10,319
Speaker 1: If you look on YouTube and see anybody talking about

925
00:50:10,320 --> 00:50:12,400
Speaker 1: the housing market, it's always like the grimmest face and

926
00:50:12,440 --> 00:50:13,399
Speaker 1: like the crash.

927
00:50:13,400 --> 00:50:14,759
Speaker 2: The crash is always the word this use.

928
00:50:14,719 --> 00:50:17,319
Speaker 1: The housing market crash, the looming and pending crash. And

929
00:50:17,560 --> 00:50:20,880
Speaker 1: like I think, based on what Lance is saying, like

930
00:50:20,960 --> 00:50:23,279
Speaker 1: unless there are sudden movements upward in interest rates or

931
00:50:23,280 --> 00:50:25,520
Speaker 1: something like that, like don't I don't see a crash

932
00:50:25,560 --> 00:50:29,440
Speaker 1: coming because we're still lack inventory, So those are often

933
00:50:29,680 --> 00:50:33,600
Speaker 1: just clickbaity sort of things, just no focus on your fundamentals.

934
00:50:33,680 --> 00:50:35,960
Speaker 1: And it's important to kind of understand what's going on

935
00:50:36,000 --> 00:50:38,000
Speaker 1: in the housing market and what's led us to this point,

936
00:50:38,000 --> 00:50:40,359
Speaker 1: and I think that can shed some light on where

937
00:50:40,400 --> 00:50:42,960
Speaker 1: things are potentially going to go in the future, but

938
00:50:43,200 --> 00:50:45,600
Speaker 1: also don't bank on exactly well people are telling me

939
00:50:45,600 --> 00:50:46,719
Speaker 1: about what the future.

940
00:50:47,040 --> 00:50:49,439
Speaker 2: Like it like, folks will start speculating and they're making

941
00:50:49,480 --> 00:50:52,959
Speaker 2: decisions outside of their own personal factories, and that's when

942
00:50:53,000 --> 00:50:55,400
Speaker 2: I think it can really end up coming back to

943
00:50:55,400 --> 00:50:55,680
Speaker 2: bite you.

944
00:50:55,760 --> 00:50:57,520
Speaker 1: And I do think some of that speculation is actually

945
00:50:57,560 --> 00:50:59,359
Speaker 1: going to lead to some of the corrections that are

946
00:50:59,360 --> 00:51:00,560
Speaker 1: going to help the.

947
00:51:00,640 --> 00:51:02,799
Speaker 2: Previous speculation that we've seen up up until this point.

948
00:51:02,800 --> 00:51:03,920
Speaker 1: It's going to help some of the folks who have

949
00:51:03,960 --> 00:51:06,239
Speaker 1: been on the sidelines maybe be able to afford a

950
00:51:06,280 --> 00:51:08,080
Speaker 1: home that they're currently unable to afford.

951
00:51:08,120 --> 00:51:10,200
Speaker 2: All right, man. The beer that you and I enjoyed

952
00:51:10,360 --> 00:51:13,440
Speaker 2: during this episode was by Other Half. This one was

953
00:51:13,640 --> 00:51:16,600
Speaker 2: Juice Lovers Big thanks to Jason Joel. What your thoughts

954
00:51:16,640 --> 00:51:17,160
Speaker 2: on this one?

955
00:51:17,360 --> 00:51:19,160
Speaker 1: So this beer has one of my favorite all time

956
00:51:19,200 --> 00:51:21,920
Speaker 1: hops in it. Nelson and I love.

957
00:51:21,800 --> 00:51:24,000
Speaker 2: That hop it's what's a Nelson hot taste Like, it's.

958
00:51:23,800 --> 00:51:28,080
Speaker 1: Just great, good, delicious, Like, man, I am no super taster,

959
00:51:28,239 --> 00:51:34,200
Speaker 1: so I don't necessarily have a wonderful explanation for it.

960
00:51:34,200 --> 00:51:36,720
Speaker 1: It definitely has like some pineapple vibes for sure, though.

961
00:51:39,120 --> 00:51:42,160
Speaker 2: There's certainly it's called juice lovers. Juice lovers, it's got

962
00:51:42,160 --> 00:51:45,759
Speaker 2: so many of those citrus like citrus pineapple. Actually on

963
00:51:45,760 --> 00:51:48,600
Speaker 2: the side here it also says white wine. I can

964
00:51:48,600 --> 00:51:50,760
Speaker 2: get behind that. Yeah, that sounds awesome, which.

965
00:51:50,600 --> 00:51:52,120
Speaker 1: Is funny because I don't ever drink white wine, but

966
00:51:52,160 --> 00:51:55,360
Speaker 1: white wine in beer, I'm like down with that. So yeah, yeah,

967
00:51:55,400 --> 00:51:56,920
Speaker 1: but no, I love this one. And this one was

968
00:51:57,000 --> 00:51:59,200
Speaker 1: actually kind of more approachable than some of the other

969
00:51:59,239 --> 00:52:03,000
Speaker 1: half beers, but still like luxurious in the way it tastes.

970
00:52:03,040 --> 00:52:07,399
Speaker 2: Yeah, super juicy, this one was delicious. Normally we kind

971
00:52:07,400 --> 00:52:10,359
Speaker 2: of recommend IPAs for those who have tried a bunch

972
00:52:10,400 --> 00:52:12,160
Speaker 2: of different craft beers before, But this is the type

973
00:52:12,160 --> 00:52:14,360
Speaker 2: of IPA that I think someone who is new or

974
00:52:14,400 --> 00:52:16,960
Speaker 2: two ips can get into because it doesn't have that

975
00:52:17,560 --> 00:52:20,000
Speaker 2: super sharp hot bite, it does have so many of

976
00:52:20,000 --> 00:52:22,960
Speaker 2: those juicy notes. It's not abrasive in like any way. Yeah,

977
00:52:22,960 --> 00:52:24,759
Speaker 2: it's so good, but that's gonna be it, buddy. For

978
00:52:24,800 --> 00:52:27,640
Speaker 2: this episode, We'll make sure to link to Lance's site

979
00:52:27,680 --> 00:52:30,200
Speaker 2: any of the different resources he may have mentioned up

980
00:52:30,280 --> 00:52:33,160
Speaker 2: on the show notes for this episode at howamoney dot

981
00:52:33,200 --> 00:52:35,160
Speaker 2: com And that's gonna be it for this one, buddy.

982
00:52:35,160 --> 00:52:39,399
Speaker 2: So until next time, best friends Out, Best Friends Out,